I move:
That the requested amendments be made.
Question agreed to.
I have received a message from the Senate acquainting the House that Senator Canavan has been discharged from the Joint Standing Committee on the National Disability Insurance Scheme and that Senator Lindgren has been appointed a member of that committee.
On behalf of the Joint Standing Committee on Treaties, I present Report 149 incorporating a dissenting report. Treaty tabled 10 February 2015 and Report 150 incorporating a dissenting report. Treaties tabled on 3 March, 5 March and 12 May 2015. I seek leave to make a short statement in connection with the report.
Leave granted.
Today I present two reports for the Joint Standing Committee on Treaties: Report 149 and Report 150.
Report 149 contains the committee's views on recent amendments to the Bonn Convention and Report 150 contains views on three proposed treaty actions: Australia's withdrawal from the World Tourism Organisation, the International Maritime Organisation's Instrument Implementation Code and the extension of the treaty between Australia and the Netherlands with regard to the Malaysia Airlines Flight MH17 disaster.
The Bonn Convention seeks to conserve land, bird and fish species that migrate across or outside national boundaries. The amendments have added 31 species to the Bonn Convention. However, Australia has lodged a reservation to adding five of the shark species to the convention. We understand that the reservation has raised concern in some quarters but the committee is satisfied that it is necessary in this instance. A number of these species are occasionally caught by recreational fishers in Australian waters. If the reservation had not been made, recreational fishers would break the law every time they caught a member of these species.
Australia proposes to withdraw from the World Tourism Organisation. Australia re-joined the organisation in 2004 but since then membership fees have increased 92 per cent. There appear to be limited benefits to Australia's tourism industry from membership of the organisation and there are claims that we are not receiving value for money. The committee is aware that the decision can be reversed, as it has been in the past, if institutions or national priorities change.
The International Maritime Organisation's Instrument Implementation Code provides a mandatory audit scheme aimed at improving maritime safety. The IMO is the United Nations agency responsible for the safety, security and environmental performance of international shipping. A range of relevant IMO conventions will need to be amended to make sure the code applies to regulations such as fire safety and management and environmental standards.
Making the scheme mandatory will encourage ongoing compliance and help the IMO identify countries that require assistance to meet its standards.
Lastly, the treaty arrangements that were put in place in late 2014 to facilitate the recovery effort after the downing of Malaysia Airlines flight MH17 are due to expire on 1 August 2015. There is still work to be done, and Australian personnel are likely to remain in the Netherlands beyond that date. The original treaty needs to be extended to ensure their ongoing protection.
The committee supports the withdrawal of Australia from the UNWTO and the ratification of the remaining treaties in these two reports.
On behalf of the committee, I commend the reports to the House.
I move:
That so much of the standing orders be suspended as would prevent the order of business for Monday, 22 June 2015 in the Federation Chamber being as follows:
(1) the Federation Chamber to meet at 10.30 am and to consider the following business:
(a) Members' three minute constituency statements;
(b) Government Business from 11.00 am to 12.30 pm;
(c) Private Members' Business from 12.30 pm to l.30 pm;
(d) 90 second statements from 4.00 pm to 4.45 pm;
(e) Private Members' Business from 4.45 pm to 6.15 pm; and
(f) the order of business for the remainder of the sitting to be as provided for in the standing orders; and
(2) any variation to this arrangement to be made only by a motion moved by a Minister.
Question agreed to.
The Tax and Superannuation Laws Amendment (2015 Measures No. 1) Bill 2015 contains seven schedules, and I should say from the outset that Labor will be supporting the bill. But the context of this debate provides an opportunity to go to some of the issues raised within this bill which go to the cessation of the first home saver accounts scheme and the government's commitment to housing affordability; to the abolition of the dependent spouse tax offset and the government's view, somewhat inconsistent, on this scheme; and to offshore banking units and the government's frankly lacklustre approach to tackling multinational profit shifting.
On the issue of housing affordability we have seen a great deal of talk from the government, but unfortunately much of that talk has managed to put much of Australia offside. It was only last week that we had the Treasurer telling a press conference that if housing were unaffordable in Sydney no-one would be buying it. As has been pointed out, one can easily take 'housing' out of that sentence and replace it with any noun you like. If diamond encrusted iPhone covers were unaffordable, no-one would be buying them, you might well say. But of course such a statement would be ridiculous. We have had clear statements now from the Treasury Secretary, John Fraser, who said:
When you look at the housing price bubble evidence, it's unequivocally the case in Sydney.
We have heard from the head of the Reserve Bank, Glenn Stevens:
What is happening in housing in Sydney I find acutely concerning for a host of reasons …
Then, going further still, he said:
Yes I am very concerned about Sydney and some of what is happening is crazy …
When central bank governors use words like 'crazy', sensible policy makers sit up and take notice. But the only response of the Treasurer to these statements from his chief economic adviser and from the head of the Reserve Bank was to say that Australians should go out and 'get a good job that pays good money'. Frankly, that is a little hard to do when you have people like Senator Abetz arguing there is a wages break-out in Australia, effectively arguing for wages to be lower, not higher. We have seen wages growth languishing under this government—perhaps unsurprising given that it is led by a Prime Minister who, in Battlelines, defended the economics of Work Choices, arguing only that the politics was bad. So, when you have got a government of Work Choices, it is going to be pretty tough for Australians to get a good job that pays good money.
Many Australians are concerned about the prospects of those on five-figure earnings being able to afford houses whose prices run into seven figures. Debate about housing affordability is an important debate for Australia to have. Yet, when the question was put to the Prime Minister from this dispatch box as to how he would respond to the Treasury Secretary's concerns about a house price bubble, his first thought was to go to his own house price—not to think about how this was affecting young Australians trying to break into the market, not to think about the fact that the homeownership rate for 25- to 34-year-olds has fallen from 51 to 41 per cent, but instead to think of his own house price.
Australians want more than a Prime Minister whose response on housing responsibility is to talk about his own home. Frankly, we need a serious debate over housing affordability. That is why Labor, through work carried out by Chris Bowen and Jan McLucas, has been engaging with the experts. That is why we have been looking at questions of infill, of making sure that greenfields development is affordable. That is why we believe that urban public transport really matters. It is why we are deeply proud that the Rudd and Gillard governments invested more in urban public transport than every other federal government going back to Federation put together. Where you have got serious investment in urban public transport, you are able to have those medium-density developments which foster housing affordability. But all this government has done on housing affordability is to abolish the first home saver accounts.
The government has no plan for housing affordability. It will not even admit that there is a problem with housing affordability. Instead, you get statements like this from the Prime Minister:
As someone who, along with a bank, owns a house in Sydney, I do hope that our housing prices are increasing.
It is cold comfort for young doctors, nurses, teachers, police officers and firefighters looking to break into the housing market in Sydney to have a Prime Minister whose chief concern is the price of his own home. The government's plan for housing affordability so far is to abolish the first home saver account.
Another part of this bill scraps the dependent spouse tax offset. In office, Labor phased back the dependent spouse tax offset, initially restricting its operation to those born before 1972 and then, in a further measure, restricting its operations to those born before 1952. It is important to note that those decisions had an impact on workforce participation because those born in the cohorts to which I have referred were of prime working age. This change is not one which can be defended in terms of labour force participation. Those affected, born before 1952, are of course aged 63 and over.
It is timely to go back to statements made by the coalition when Labor made decisions to phase back the dependent spouse tax offset. In a speech on 23 November 2012, Joe Hockey, the now Treasurer, described Labor's decision to restrict the dependent spouse tax offset as a 'tax grab'. The now Treasurer referred to phasing it back as a 'tax grab' and yet has now brought forward, in his own budget, the complete repeal of the measure. It is hard to see how this is consistent with statements such as that from the Prime Minister in August 2013 that 'taxes will always be lower under a coalition government' and:
… there will be no overall increase in the tax burden whatsoever.
Yet, if we look at the government's own budget papers, it is absolutely clear: the tax-to-GDP ratio in this year's budget is higher than in any year under Labor.
Labor is prepared to take a sensible approach to ensuring that the budget over time moves back into surplus. We have proposed a package which reduces excessive superannuation taxation concessions for high-income earners, a package which raises $14 billion over the course of the decade. If one looks at budget numbers, it is very clear—indeed, from the government's own Intergenerational reportthat pensions as a share of national income will sit at about the same level mid-century as they do now, but that cannot be said for superannuation tax concessions. They are growing extremely rapidly, forecast to double in size over the course of just four years and soon to outstrip the total cost of the pension. That is why Labor has put forward a responsible plan to tackle superannuation tax concessions for high-income earners.
We have also passed more than $20 billion of savings and backed billions of dollars of savings in this budget, including savings which were put forward in a way that Labor would not have suggested. Our support for the approximately half a billion dollars in savings in this bill is emblematic of the approach that Labor have taken to working with the government. Where measures are unfair, we have opposed them. We do not support the idea of taking $6,000 away from sole parents on $60,000, stripping one dollar in 10 out of their wallets and purses. We do not support cutting the wages of the cleaners who clean this office—and I was proud to be out the front of Parliament House yesterday with some of those cleaners, taking industrial action in order to stand up for being paid a decent wage. But we have supported the government on various savings measures.
In this bill are some tentative steps to address the issue of multinational profit shifting. When the coalition were in opposition, they voted against Labor's sensible measures to get multinationals to pay their fair share. They voted against transparency measures. And, when they came to office, they refused to follow through in enacting Labor's multinational tax package, effectively giving $1.1 billion back to multinationals.
Part of the measures that the government failed to proceed with is around offshore banking units. Offshore banking unit changes are timely in ensuring that multinationals cannot take advantage of tax concessions that are unavailable to small businesses. This government claims it is a friend of small business, but, if you want to stand up for small business, you need to stand up for making sure that multinationals pay their fair share, because an Australia in which multinationals are able to access tax loopholes not available to small businesses is an Australia without a level playing field. Labor's multinational tax package, which raises $7 billion over the decade, is a pro-small-business measure because it acts to level the playing field. These measures on offshore banking units raise $41.8 million. That is less than half the amount that would be raised under the package on multinational tax avoidance brought forward by Bill Shorten, Chris Bowen and me.
We have also seen today clear statements from the Assistant Treasurer as to why the government wants to wind back tax transparency. Previously, the government had been suggesting that it was doing so because it was concerned about kidnap risk. It then emerged that the government had sought no advice from the Australian Federal Police about tax transparency increasing kidnap risk. So now we have the Assistant Treasurer writing in The Australian that his real concern about reporting the tax paid by some of the largest firms in Australia is that it might lead to 'envy'—that Australians might be envious when they realise that big firms are not paying their fair share. There was no concern about the feelings of the cleaners in this building when their wages were cut, but, when it comes to cutting the tax transparency for big firms, suddenly the government goes all Dr Phil. Suddenly it is time for inviting them into the office, putting them on the couch, giving them a foot rub and seeing how they really feel. Firms who are doing the right thing have nothing to fear from tax transparency laws. They enable us to have a sensible public debate about our tax laws.
When organisations such as the Tax Justice Network and United Voice bring forward reports which outline how much tax is being paid, the government is quick out of the blocks to try to discredit those reports, claiming they are based on inaccurate data. There is an answer to that: we need to get accurate information into the public domain. We are not asking for everyone's tax affairs to be reported; we are arguing that for firms with a turnover in excess of $100 million, it is appropriate for the Australian Taxation Office to report their total income, their taxable income and their tax paid.
As Justice Brandeis said, not the Brandis of the other place but Justice Louis Brandeis, 'Sunlight is the best disinfectant.' If we are to let the sunlight in on the tax affairs of big companies, we can have a sensible debate around multinational tax avoidance. And it is a timely debate because at a time when inequality in Australia is at a 75-year high, after a generation during which earnings have grown three times as fast for those in the top decile as the bottom decile of wage earners, we have a government that is trying to take $6,000 a year away from the poorest single parents.
NATSEM modelling—done by the organisation which is the Prime Minister's favourite modeller—finds that nine out of 10 of the poorest families in Australia are made worse off by decisions of the coalition. One of the impacts of that of course is to increase inequality, but another impact is to hurt consumer confidence. High-income earners save about a quarter of their incomes. Low-income earners spend it all. So when you transfer resources from the poorest to the richest, you take money out of retail sales. That might help explain why Westpac's consumer confidence index is still seven per cent lower than when the coalition took office. That fall in consumer confidence demonstrates what Australians already know, that the government does not have a plan for confidence, does not have a plan for jobs and lacks a plan for the economy.
In February 2013, Tony Abbott said:
I am confident that should there be a change of government later in the year, there will be an instantaneous adrenaline charge in our economy. There will be an instantaneous surge of confidence because of an incoming government.
The tide has gone out on the surge of confidence. It is seven per cent lower than when the coalition took office. What has been the response of the government to this? Has it been to begin talking the government up, to begin talking about how we can develop a long-term plan for jobs and growth? No. Instead, their plan has been to spend more on promoting the budget and the Intergenerational report. We now know Treasury has allocated $36 million to spend on the budget and promoting the Intergenerational report. Dr Karl Kruszelnicki has now said of his participation in advertisements around the Intergenerational report:
I deeply regret that I didn't get to see the full and final version.
I am sure many Australians deeply regret that $36 million of their money, more than a dollar a person, is being spent on propaganda for the government trying to sell its budget. I have a simple message for the government: if they are concerned about the way their unfair budget is going down in the community, fix the budget; don't start spending money on TV ads.
As respected economist Saul Eslake noted in a budget forum that was run in Parliament House, there have been a number of tricks in the budget papers in order to try to improve those numbers. He notes a footnote on page 3-6 of Budget Paper No.1, which says that from 2020-21 onwards earnings from Australia's Future Fund will be counted towards the surplus and that by 2024-25 that will account for more than half the projected surpluses. Mr Eslake made an interesting statement in that forum. He said:
I point to the influence of a change in accounting policy hesitantly because the last time I was critical of a government for the way it accounted for things in the budget the then treasurer, Peter Costello, rang up the chief executive of the bank I was working for, John McFarlane, (of ANZ) and said that he would take regulatory action that ANZ did not like if I repeated those kinds of criticisms.
(But) I don't think Joe Hockey is as glass-jawed as Peter Costello is, so I am not really worried about that in this context.
But he does go on to say that he is concerned about the fact that more than half of the projected surpluses in a decade's time will come from an accounting change not from policy change.
Saul Eslake also raised his concern about the government's claim that it was offsetting its spending decisions through making savings. As he pointed out, the way the government was able to back up that claim was because they had to put in the contingency reserve $10.4 billion for their unfair Paid Parental Leave scheme. Then when they decided not to proceed with their unfair Paid Parental Leave scheme, they took that money out of the contingency reserve. Why didn't we think of that? Why didn't we think of announcing an unfair policy, throwing the money in the contingency reserve, not going ahead with the unfair policy and then saying we'd made a saving? Frankly, deciding that you are not going to implement a bad policy and calling that a saving would not pass the pub test in Australia.
What we see from this government is that it is at odds with one another. We have seen cabinet leaks, the likes of which we have not been seen in this country for over a decade, and infighting between frontbenchers. And if you want to know what is going on in cabinet, you simply need to read the newspapers. Peter Hartcher's expose of the internal workings of the Abbott government clearly reveal a government that is willing to leak against itself. We saw Christopher Pyne on The Bolt Report on the weekend saying that as a result of the Abbott government leaking like a sieve, he cannot speak candidly in cabinet anymore. That is how dysfunctional the cabinet has become.
The government has no plan for housing affordability, no plan for anything but driving up the Prime Minister's own housing price. We need a government that is able to seriously act on the challenges of the future, challenges like investing in infrastructure such as making sure that more Australians get the coding skills they need at school and the science education they need at university. That plan for the future was laid out in Bill Shorten's budget reply and it is a plan that we will continue to build on over the time up to the election.
I rise to support the Tax and Superannuation Laws Amendment (2015 Measures No. 1) Bill 2015. As the Assistant Treasurer said in his second reading speech, the bill amends various taxation and superannuation laws to implement a range of improvements to modernise Australia's taxation system. As I understand it, this bill includes a number of amendments that relate to issues lodged on the tax issues entry system, a platform for members of the community to raise issues regarding the care and maintenance of the Australian government's tax and superannuation systems. Indeed, I myself have some concerns to raise about the superannuation system.
As this is a bill for an act to amend the law relating to taxation and superannuation and for related purposes I am allowed to address a burning issue in my electorate, which is the threat to the superannuation and other retirement income of people in Eden-Monaro. Their retirement savings are threatened by a multipronged attack by the Australian Labor Party. At the latest census there were some 43,984 people over the age of 55 in my electorate. That is 32.5 per cent of the population of Eden-Monaro and compares to only 25.6 per cent for the nation as a whole.
So what is the threat? The Labor Party are determined to attack the retirement savings of everyday Australians in a desperate attempt to plug their growing budget black hole. Firstly, Labor want to double the tax that Australians pay on their superannuation contributions if they earn over $250,000 a year. I strongly doubt that Labor can be trusted to stop there. In addition, Labor's other recent policy announcement is to ensure that superannuation earnings of more than $75,000 during the retirement phase are taxed at a concessional rate of 15 per cent instead of being tax-free. And Labor have stated that there would be no indexation of the threshold. The fact that they would not index those thresholds is of great importance. It means that the changes would affect thousands more Australians as the years pass by and inflation brings the effective threshold down every year in real dollar terms.
Why is this all very alarming? A short history lesson will help explain. Before the 2007 election Kevin Rudd said that there would be no change to super, 'not one jot, not one tittle'. In fact, they increased taxation on super by just short of $9 billion, including cutting super benefits for lower income earners by more than $3.3 billion. What we actually saw was no fewer than 12 tax grabs for the superannuation of ordinary Australians. In May this year the shadow Treasurer said at the National Press Club:
… what we have flagged is that we are still doing work on other aspects of superannuation policy.
So there is obviously more to come. Let us dissect the Labor argument to so-called fixed superannuation. Let us also assume for a moment that Labor see a genuine need to fix superannuation rather than indulge in a grab for cash. Let us assume that they seek to because they believe superannuation is lightly taxed. Let us look at that proposition.
Highly regarded economist Henry Ergas has previously examined the issue. In this case he has noted that the headline tax rate on superannuation of 15 per cent is not an accurate indicator of how heavily superannuation is taxed. According to his analysis, the effective tax rates on long-term superannuation savings are close to or even above the top rate of income tax. We need to look at the difference between nominal and effective tax rates on long-term investments. In an article published on 15 October 2012 Mr Ergas noted that superannuation allows savers to defer consumption. Mr Ergas wrote:
Assuming a real annual return of 5 per cent and an inflation rate of 2.5 per cent, the effective income tax rate on a dollar invested today and withdrawn in 35 years is 40 per cent.
He went on to say:
Effective tax rates on long-term savings in our "concessional" regime are therefore more than twice the nominal 15 per cent rate.
And that ignores the impact of volatility in returns and the fact that income from super reduces saver's entitlements to the aged pension.
When those are factored in, effective rates are likely at or beyond the top income tax rate of 46.5 per cent.
But that is not all. As I have previously said, policy makers cannot simply ignore the fact that the superannuation system we have in Australia today is a classic case of a social contract. It is a social contract where people were effectively given a deal whereby they would accept compulsion to mandatorily put money into super and to lock it away for decades in exchange for lower levels of taxation. To then subsequently turn around and remove those taxation concessions is a blatant breach of that social contract.
When Labor want to hike superannuation tax, they get the numbers all wrong. What about the numbers of people affected by their policy? Modelling for Senator David Leyonhjelm by the Parliamentary Budget Office has shown that Labor's attack on superannuation could affect more than twice as many people as they claim. The proposed $75,000 threshold policy would affect more than 125,000 taxpayers by 2027—more than double the number those opposite claim will be initially affected. Further, the high-income super surcharge of 30 per cent would affect more than 300,000 people, not the 110,000 claimed by Labor.
However, that is not all the Parliamentary Budget Office exposed. Not only will the tax hike affect more than twice as many people as Labor claims; Labor's tax hike on superannuation will hurt low-income earners. How? The Parliamentary Budget Office analysis found that substantial additional compliance and administration costs would be incurred. Those extra government administration costs alone would be more than $20 million a year. It is not difficult to see that super funds will pass these additional costs on to members, including low-income earners.
I know that devising tax policy is hard work—I have been turning my mind to it for three decades—but this degree of economic illiteracy is unacceptable. As I said, Labor have launched a multipronged attack on the retirees of my electorate of Eden-Monaro. So what might Labor also be planning? We do not have to go far, as they have been doing media interviews to float their impending policy. Only last week, on 10 June, it was reported in the Australian Financial Review that the shadow minister for finance, the member for Watson:
… told ABC radio that capital gains tax concessions for investors would also be on the table for consideration, along with stamp duties and negative gearing.
"All of these play into a mix which means when somebody's going to buy a property, they're not simply competing with other home owners, they're competing with a disproportionately high number of investors," he said.
Labor have made a calculated gamble, based on an appeal to the politics of envy, to target retirees to fund the vote-buying spree that the Leader of the Opposition announced in his budget in reply speech. It is not about good policy.
Just a little economics lesson for these people: negative gearing is not some special tax subsidy for housing investors, as they want to propagandise. It is in fact a legitimate business expense model incorporated in the bedrock of our taxation system to reduce double taxation on investment and therefore encourage the investment that sustains our economic prosperity. It is not a subsidy or a tax dodge; it is integral to our tax system. And it is perverse to think that any proposition to raise effective taxation levels on investment in housing in some way assists in dealing with the supply issue we face in providing affordable housing.
And let me also note that the so-called unfair tax competition, raised by many people who should know better, between housing investors who have negative gearing and first home buyers who do not have negative gearing is a false comparison verging on outright lies. It wilfully ignores the fact that home owners get a huge capital gains tax break with a complete exemption on the principal residence. To compare apples and apples, that huge tax break available to homeowners compared to what landlords get needs to be taken into account. In my view, over time you may find that it is an even bigger tax break. I would like to know whether Labor, in all their talk about capital gains tax, are planning to remove the tax exemption for principal residences, because the logic of their rhetoric would lead to that conclusion.
Lastly, can I just say that, while the Reserve Bank governor can say that the housing market in Sydney is a bit 'crazy', the tax debate in this country at the moment is completely crazy. People who are completely ignorant about tax design are pontificating on something that they have no idea about, and in addition there are many people who should know better who are being swept along in a river of make-believe. To massively increase taxation levels on investment by slashing into superannuation, negative gearing and capital gains tax is perverse given the wider economic challenges facing the nation. Everyone should just step back and think what the economic and financial challenge facing the country is. As clearly outlined in the Intergenerational report, Australia's big mega-trend economic challenge is an ageing population, going from 7.3 working-age people for every person aged 65 and over in 1975 to a projected 2.7 workers per retiree in 2055. That has massive economic and financial implications.
One of the absolute givens in responding to this challenge is to increase people's savings for retirement to take the pressure off the taxpayer to meet the massive future demand. Instead the Labor party and the Greens are ignoring the big picture and simply seeking ways to fund increased government expenditure by ironically hitting private savings through attacking superannuation, negative gearing and capital gains. It is cock-eyed economics at its worst.
For short-term expediency they are justifying their tax grab as some sort of solution to a so-called housing bubble in Sydney. Let's be clear: we should not be setting our taxation system simply based on the property market in Sydney. Paul Keating acerbically once said, 'If you're not living in Sydney you're camping out.' It appears that the Labor leadership still holds to that outrageous sentiment. Well, I can say most Australians do not live in Sydney, and I will be standing up for the people of Eden-Monaro in their fight against this threat from Labor.
Lastly, can I say that the solution to Sydney's housing issues is not taxation measures designed to impact on the demand side of the equation. There are numerous studies, including from the Productivity Commission, over the last two decades that show that a major part of the problem is planning rules and costs imposed on developers in the Sydney market that restrict the amount of supply. We should be looking at addressing these problems directly. State and local governments have the most to do to handle these issues.
However, I think Australian policymakers need to come to a realisation that the world has changed in the last few decades. Sydney is now truly a world-class city on par with London, New York, Los Angeles and Tokyo, to name a few. We cannot keep thinking that in an international city, with all its associated expenses and population pressures, you can expect to have the same level of owner occupiers as in other cities. Today, Sydney has an owner occupier ratio of around 65 per cent, compared to around 67 per cent for the nation. However, according to the latest statistics I could find, in London it is less than 50 per cent, while for the UK as a whole it is 64 per cent; in New York it is 32.2 per cent and in Los Angeles 49 per cent, compared to 65 per cent for the US as a whole; in Paris it is less than 30 per cent, compared to just over 50 per cent for France as a whole; and in Tokyo it is 44.6 per cent, compared to 61 per cent for Japan as a whole.
Australian lawmakers cannot ignore this fact of life. The Sydney levels of owner occupation will probably fall to match those of other international cities. It will necessarily be dictated by the constraints on urban transport and other infrastructure provision. As a result, we should also be looking at other innovative ways to deal with this problem. I have advocated high-speed rail as a development solution that would massively open up regional New South Wales and Victoria for residential development, which would be a way of dealing with our overcrowded mega cities of Sydney and Melbourne. This part of the answer is staring our political leaders in the face, and they should just get on with it.
I rise to provide a few brief remarks on the Tax and Superannuation Laws Amendment (2015 Measures No. 1) Bill 2015, which makes various amendments to taxation and superannuation laws. The Assistant Treasurer and subsequent speakers have comprehensively canvassed the contents of the bill, so I will not do so in detail on this occasion. Briefly, the bill abolishes Labor's failed first home saver account scheme. It abolishes the dependent spouse tax offset, which has outlived its usefulness and has been substantively replaced by the dependent (invalid and carer) tax offset. Changes are made to tax law concerning offshore banking units. The Global Infrastructure Hub announced as part of Australia's G20 presidency is to be made tax exempt, and various other tax law changes of a technical nature are made.
However, I particularly wish to focus on schedule 5 of the bill, which relates to tax deductible gift recipient extensions. Schedule 5 extends the specific listing of two entities as deductible gift recipients, or DGRs—namely, the Australian Peacekeeping Memorial Project and the National Boer War Memorial Association. This will require an amendment to the Income Tax Assessment Act 1997 to update the list of specifically listed deductible gift recipients. The listing will be extended to 1 January 2018. Consequential amendments will also be made to extend the automatic repeal date of the deductible gift recipient listings. The listings will now be automatically repealed on 1 July 2022.
The Australian Peacekeeping Memorial Project Incorporated and the National Boer War Memorial Association Incorporated are seeking donations to build memorials on Anzac Parade in Canberra. The extension of the deductible gift register listing of these organisations was announced by the Treasurer in the 2015-16 budget. In introducing this bill, the minister made mention of the fact that both the Australian Peacekeeping Memorial Project and the National Boer War Memorial Association have fallen short of their fundraising targets. He explained that the extension of their deductible gift recipient status will help these organisations attract public financial support for their activities, as taxpayers can claim an income tax deduction for certain gifts to deductible gift recipients. Income tax law allows tax deductions for taxpayers who make gifts of $2 or more to deductible gift recipients. The financial impact of the amendments contained in schedule 5 will be $1.4 million over the forward estimates.
The fundraising efforts by the National Boer War Memorial Association for a memorial in Canberra are an issue that is particularly close to my heart. My great-uncle, Major Edmund Righetti, served in Victoria's first contingent to go to the Boer War in 1899. He was severely wounded but recovered and returned to South Africa to serve again. His revolver from that time is in the collection of the Australian War Memorial. More than 16,000 Australians served in the Boer War, and more than 500 Australian soldiers lost their lives in the conflict. I should declare here that I am a founding member of the National Boer War Memorial Association. In 2013 I received a petition, delivered on horseback at the front of Parliament House, of more than 10,200 signatures, calling on the then federal government to support a national Boer War memorial on Anzac Parade. It was a petition that I was honoured to receive and a cause that I wholeheartedly support. The Boer War marks the birth of the Australian Defence Force and the emergence of a new nation after Federation. Unfortunately there is currently no national memorial in the capital to honour the soldiers, nurses and trackers of this conflict, who were the first to fight under the Australian flag.
The site for the memorial was selected in 2006. A design competition was conducted in 2013, the winning design being a spectacular scene depicting four larger-than-life-size mounted troopers in action, to be erected in bronze. The first of the statues has been completed and, as of April, was in the process of being shipped to Canberra. A total of $1.8 million has been raised to date, with organisers hoping to raise an additional $2.7 million in time to complete the memorial by Boer War Day, 31 May, in 2017. At this point I would like to acknowledge Miles Farmer and Queensland Committee Chairman Ron McElwaine from the Sherwood/Indooroopilly RSL sub-branch for their ongoing fundraising efforts towards this very worthy project.
The cost to the budget of extending the deductible gift recipient status of the National Boer War Memorial Association will be minimal—less than $1 million over the forward estimates. But what it says about the commitment of the Australian government to the memory of those men who lost their lives in the Boer War conflict is so much greater. As a nation we need to remember those who came before us and those who died fighting in our name. The way Australians have come together this year to commemorate the Centenary of ANZAC is testament to our willingness to remember. This bill, in its own small way, allows us to better preserve the memory of the fallen in the Boer War as well as Australians who have died in peacekeeping missions abroad. I commend this bill to the House.
I rise to speak on the Tax and Superannuation Laws Amendment (2015 Measures No. 1) Bill 2015. As the Assistant Treasurer in his second reading speech mentioned, schedule 1 of this bill abolishes the first home saver account scheme. Schedule 2 of the bill abolishes the dependent spouse tax offset with effect from 1 July, as announced in the budget. Schedule 3 to this bill amends the taxation law to modernise and improve the integrity of the offshore banking unit regime. Schedule 4 adds the Global Infrastructure Hub to the list of named income-tax-exempt entities in division 50 of the Income Tax Assessment Act 1997. Schedule 6 makes a number of amendments across the tax and superannuation law to provide certainty for taxpayers. Schedule 7 amends the income tax laws to implement the final stage of the investment manager regime.
But, like the member for Ryan, my particular focus is on schedule 5, which extends the specific listings of two entities—the Australian Peacekeeping Memorial Project and the National Boer War Memorial Association—as deductible gift recipients for a further three years. We have just recently celebrated Boer War Day, which commemorates the first war in which Australia fought as a nation and the first war in which we fought alongside New Zealanders. The 31st of May is the anniversary of the signing of the Treaty of Vereeniging, which ended the South African War in 1902. Services were held this year in both Hobart and Launceston, at the very beautiful memorials in the Domain in Hobart and in the City Park in Launceston.
This amendment bill will be of particular interest to many people in my electorate of Lyons because of a section deep in the bill which honours the memory of those Tasmanians who have served so bravely both in war and on peacekeeping missions for their country. I am pleased that one of the things that we are debating today is the proposal to extend the specific listings of the two entities I mentioned as deductible gift recipients for a further three years. This is a most worthy inclusion for Tasmanians and their fellow Australians from the colonies, as they were at the time, who fought so long ago during the Boer War and for those who served much more recently in Australia's peacekeeping missions.
Five Australians were awarded the Victoria Cross for acts of bravery during the Boer War, including two Tasmanians, Trooper John Hutton Bisdee and Lieutenant Guy Wylly. Trooper Bisdee also has the distinction of being the first Australian born soldier to be awarded a Victoria Cross. The conflict which became known as the Boer War, or the Second Boer War, involved two independent Boer republics in South Africa, the Orange Free State and the South African Republic, also known as the Transvaal Republic, who saw British interests in South Africa as a threat to their independence. The discovery of gold and diamonds in the Boer Republics in the 1880s intensified rivalry and British imperial ambition. Boer independence resulted in fiction, which in 1899 provoked the Boers to attack in order to forestall what they saw as an impending British conquest.
As part of the British Empire, the Australian colonies offered troops for the war in South Africa. At least 12,000 Australians and New Zealanders served in contingents raised by the six colonies, and then, after Federation in 1901, the new Australian Commonwealth. About one-third of the men enlisted twice, and many more joined British or South African colonial units. At least 600 Australians died in the war, about half from disease and half in the course of action.
My home state of Tasmania, which has always punched above its weight in terms of serving its nation, contributed four contingents of soldiers, totalling 558 men, to serve in the South African War. Twenty-two Tasmanians died during the war, with 11 being killed in battle or dying of their wounds and another 11 dying from diseases contracted in the conditions under which they served. Soldiers from Tasmanian contingents were also awarded Distinguished Service Orders and five Distinguished Conduct Medals for services performed during the Boer War, and another three were made Companions of the Order of the Bath.
As I mentioned before, two Tasmanians were awarded the Victoria Cross. Trooper John Hutton Bisdee was a trooper in the 1st Tasmanian Imperial Bushmen unit. He was born on 28 September 1869, at Hutton Park, Melton Mowbray, in Southern Tasmania, in my electorate. He was a student at the Hutchins School in Hobart and worked on his father's farm after finishing school, before enlisting for service in South Africa in April 1900. He saw action in both the Orange Free State and the Transvaal before he was wounded and forced to return home. But he returned to South Africa in March 1901 as a lieutenant with the 2nd Tasmanian Imperial Bushmen.
On 1 September 1900, a group of eight Tasmanian Imperial Bushmen, including Bisdee, formed an advance scouting party on horseback under the command of fellow Tasmanian, Lieutenant Guy Wylly. Bisdee became the first Australian-born soldier to be awarded the Victoria Cross for his actions in the following incident. It was reported that Bisdee and other members of an advance scouting party were ambushed by Boers in a rocky defile. Six of the party of eight were hit, including two officers, Major Brooke and Lieutenant Wylly. Brooke's horse had bolted, so Bisdee dismounted, put the officer on his own horse and, despite being seriously wounded himself, ran alongside, mounted behind him and withdrew under heavy fire.
Bisdee continued to serve in South Africa until the end of the Boer War. He returned to Hutton Park in Tasmania to resume farming and to marry Georgina Theodosia Hale. In 1906, Bisdee returned to service when he joined the 12th (Tasmanian Mounted Infantry) Australian Light Horse Regiment, and by 1910 had risen to the rank of captain, then becoming commanding officer in the 26th Light Horse. He is also the second cousin to the current mayor of the Southern Midlands, Mayor Tony Bisdee.
Guy Wylly was born in February 1880. He was the son of an Indian Army major and spent part of his childhood in India before his family moved Tasmania, settling in Sandy Bay. Like Bisdee, he was a student at the Hutchins School, but he completed his final years at St Peter's College in Adelaide before returning to Tasmania. He joined the 1st Tasmanian Imperial Bushmen in 1900 and on 26 April left for South Africa as a lieutenant. On 1 September 1900, Wylly was part of the same advance scouting party as Bisdee and was awarded the Victoria Cross for the following action. Wylly was one of two officers present at the same action as John Bisdee. Wylly, himself wounded, saw that one of his men, Corporal Brown, was badly wounded in the leg and was dismounted. Wylly, despite his own wound, went to his aid, giving his horse to Brown and, at the risk of being cut off, opened fire from behind some rocks to cover the retreat of the others in the party. Our Tasmanians, as usual, were valiant in action so long ago, and we are indeed proud of them.
As I mentioned before, I am pleased to say that this bill we are debating today, the Tax and Superannuation Laws Amendment (2015 Measures No. 1) Bill 2015, honours the memory of those Tasmanians and their fellow Australian soldiers who fought so bravely in the Boer War. Schedule 5 of the bill extends the specific listings of the deductible gift recipients for a further three years. Both of these memorial projects have fallen short of their fundraising targets, so the extension of their deductible gift recipient status will help these organisations attract public financial support for their activities because taxpayers will be able to claim a tax deduction for certain gifts to deductible gift recipients such as the ones we are discussing today. This is entirely appropriate so close in time to the commemoration events held recently around Australia over the past couple of weekends to mark the end of the Boer War, on 31 May 1902.
It will also help those working on the National Peacekeeping Memorial Project, such as Phil Pyke from my electorate of Lyons and the beautiful town of Lachlan. Phil is now heavily involved in Tasmania's flourishing fruit and berry industry, but the former policeman also served as an Australian in United Nations peacekeeping operations. He told me that this year will be the 68th year of Australia's enduring mission to support the United Nations peacekeeping operations. Australia has been actively and continually involved in peace operations for all those years, although our military and police contributions have increased significantly in the past decade.
In 1947, four Australian ADF officers were the world's first ever peacekeepers when deployed to the Dutch East Indies, under the UN Commission for Indonesia. In the past few years, a proposal has been developed for a peacekeeping memorial to be built in the nation's capital, Canberra, to honour all those who have served and will serve on peacekeeping opportunities. These include officers from the Australian Defence Force, the federal, state and territory police forces and government agencies who have served and died on peacekeeping operations commanded or authorised by the United Nations or sanctioned by the Australian government.
Australia's enduring mission in peacekeeping has not been widely recognised, and so the memorial project has not attracted the necessary corporate funding to complete the project. Retaining the deductible gift recipient status for the Australian Taxation Office, which this bill allows, will allow the memorial committee to continue fundraising—and that is welcomed by Phil Pyke. Once completed, the memorial will be a reminder of the hard work undertaken by more than 66,000 Australians on more than 70 United Nations peacekeeping missions in troubled areas such as Rwanda, Cambodia, the Middle East, Mozambique, East Timor, the Solomon Islands, Iraq and Afghanistan.
I commend the bill to the House.
Let me begin by thanking members who have contributed to this debate. This bill is part of the government's plan to modernise and update Australia's tax and superannuation laws. The bill removes uncertainty from our tax and superannuation laws and removes laws that are ineffective and outdated. It will make our laws more relevant and provide incentives for investment so that Australia can better compete on the global stage. This government, with the release of the tax white paper earlier this year, is demonstrating its ongoing commitment to Australians to modernise our tax laws and make genuine reforms. The amendments today are a step towards that.
Schedule 1 to this bill will abolish First Home Saver Accounts. First Home Saver Accounts have failed to live up to the promises that were made during their introduction. Rather than the $6.5 billion in total combined savings promised by the previous government, at the beginning of last year there were fewer than 50,000 open accounts containing total combined savings of only $540 million, or less than 10 per cent of what was initially predicted. Abolishing First Home Saver Accounts will save more than $130 million over the years to 2017-18. We know that owning a home is an important goal for many people across the country and we know that rising house costs mean this goal seems further and further out of reach every day. But First Home Saver Accounts do not address the underlying reason for rising house costs in Australia, one of which is that the supply of housing is failing to keep up with strong growth in demand. As part of the government's wider deregulation agenda, we are working with state and territory governments to reduce the regulatory barriers currently holding up the supply of housing and construction. This will increase land release for new homes, leading to an improvement in housing affordability for all Australians.
Schedule 2 to this bill will abolish the Dependent Spouse Tax Offset with effect from 1 July 2014. This will make our tax system more equitable and return $320 million to the budget over the years to 2017-18. When the Dependent Spouse Tax Offset was introduced in the early 20th century, its purpose was to provide a concession to taxpayers who maintained a dependent spouse. Our welfare system has developed markedly since then, with a wide range of more tailored support available. With changes in our society, as well as in our economy, this offset is now outdated. Given the support now available through the welfare system, as well as the need to promote workforce participation, this concession is no longer needed and, in the current budget situation, it is simply not sustainable. This measure is an important step towards repairing the budget and it is also part of the government's broader agenda to encourage participation.
Schedule 3 to this bill amends the taxation laws to modernise and improve the integrity of the Offshore Banking Unit regime. This bill includes changes that include key recommendations arising from the 2009 report Australia as a financial centre, also known as the Johnson report, aimed at improving Australia's position as a leading financial services centre. The Offshore Banking Unit reforms will better target the Offshore Banking Unit tax concession by updating the list of eligible activities encouraging genuine mobile financial activities. Alongside these changes, we will also improve the integrity of the regime to ensure that this concession is not subject to abuse. The government believes that this bill strikes an appropriate balance between encouraging Offshore Banking Unit activity and maintaining the integrity of the tax system.
Schedule 4 to this bill adds one organisation to the list of named income tax exempt entities in division 50 of the Income Tax Assessment Act 1997. The new listed entity is Global Infrastructure Hub Ltd. Global Infrastructure Hub Ltd was established to implement the G20's multi-infrastructure agenda. The Australian government, along with several other countries, has pledged a financial contribution to Global Infrastructure Hub Ltd. Without the amendment to the act, the contributions made to Global Infrastructure Hub Ltd would be assessable and would be taxed accordingly. It would be inappropriate for the Australian government to tax assistance provided to Global Infrastructure Hub Ltd under an arrangement agreed to as part of Australia's G20 presidency.
Schedule 5 to this bill extends the specific listings of two entities as deductible gift recipients for a further three years—the Australian Peacekeeping Memorial Project and the National Boer War Memorial Association. Both the Australian Peacekeeping Memorial Project and the National Boer War Memorial Association have fallen short of their fundraising targets. The extension of their deductible gift recipient status will help the listed entities attract public financial support for the activities as taxpayers can claim an income tax deduction for certain gifts to deductible gift recipients.
Schedule 6 to this bill makes a number of amendments across the tax law to provide certainty for taxpayers. These amendments make sure that the law operates as intended by correcting technical or drafting defects, removing anomalies and addressing unintended outcomes. This furthers the government's commitment to restore simplicity and fairness to the Australian tax system. It also demonstrates the government's commitment to the care and maintenance of the tax law. By clarifying the law and repealing unnecessary provisions, these amendments also further the government's deregulation agenda. A number of the amendments relate to the issues lodged on the Tax Issues Entry System, a platform for members of the community to raise issues regarding the care and maintenance of the Australian government's tax and superannuation system. These include ensuring that life insurance companies are not inappropriately liable for franking deficit tax; correcting inconsistent wording in the definition of 'in-house residual fringe benefits'; and updating a diagram intended to provide guidance on when an entity is required to, or may, register for the goods and services tax.
Schedule 6 to this bill also clarifies the operation of other areas of the tax law, including how employee share ownership schemes are intended to be taxed in the context of a demerger. Additional amendments fix a defect in the law preventing the Commissioner of Taxation from revoking access to certain tax concessions due to past periods of non-compliance by the entities seeking to rely on the concessions.
Schedule 7 to the bill amends the income tax laws to implement reforms to the Investment Manager Regime. This bill represents the final stage of changes to give effect to a new regime, as envisioned, which the Johnston report has referred to earlier. The IMR will promote Australia as a financial services centre by encouraging foreign investment in Australia from foreign managed funds that are widely held and encouraging foreign investment through Australian fund managers. The IMR does this by providing greater clarity and certainty regarding the tax treatment of foreign investors including foreign managed funds. These reforms have been carefully designed so that they strike an appropriate balance between encouraging foreign investment and ensuring the integrity of the regime.
Additional parliamentary amendments have been made to schedule 7 to address concerns raised with the Senate Economics Legislation Committee. These changes are intended to clarify the operation of certain provisions to give the funds management industry confidence that they can take advantage of the IMR concession as intended. Full details of each of these measures are contained in the explanatory memorandum.
In conclusion, this bill is very much a part of the government's overall plan to update and modernise our tax system. Our tax system must adapt to the changes that are happening around us. These changes today lay the groundwork for our continued efforts to ensure our tax system is efficient, modern and well targeted. The dialogue we are having with Australians through the tax white paper process is part of our strategy to improve our tax system. An effective and relevant tax system is the foundation of any healthy working economy. Our commerce and industries are more connected internationally today than ever. We are confronted with new business models through the increased use of the internet and business operations which are increasingly borderless and posing challenges for tax systems globally. Our tax system has to evolve to stay current. We must continually adapt to our changing environment and ensure our tax system is one that is sustainable, efficient and relevant. I commend this bill to the House.
Question put.
Bill read a second time.
I present a supplementary explanatory memorandum to the bill, and ask leave of the House to move government amendments (1) to (13) as circulated together.
Leave granted.
I move the following government amendments, as circulated, together:
(1) Schedule 7, item 1, page 76 (line 34), omit "*permanent establishment", substitute "permanent establishment (within the meaning of the relevant international tax agreement)".
(2) Schedule 7, item 1, page 77 (line 14), omit "fund", substitute "entity".
(3) Schedule 7, item 1, page 77 (line 33), omit "permanent establishment", substitute "*permanent establishment".
(4) Schedule 7, item 1, page 78 (line 2), at the end of subsection 842-215(3), add:
; and (e) subsection 842-225(2) does not apply to the IMR financial arrangement.
(5) Schedule 7, item 1, page 78 (lines 11 to 15), omit paragraph 842-215(5)(b), substitute:
(b) if the issuer of, or counterparty to:
(i) the IMR financial arrangement referred to in paragraph (a), if it is a *financial arrangement; or
(ii) otherwise—the IMR financial arrangement to which that arrangement relates;
is an Australian resident, or a *resident trust for CGT purposes—during the whole of the year, the interest of the entity in the issuer or counterparty does not pass the *non-portfolio interest test (see section 960-195); and
(6) Schedule 7, item 1, page 78 (line 26), omit "a payment from which an amount", substitute "an amount that".
(7) Schedule 7, item 1, page 78 (after line 30), at the end of section 842-215, add:
(7) For the purposes of subparagraphs (2)(a)(i) and (3)(c)(i), an entity is taken to be a resident of a country that has entered into an *international tax agreement with Australia if the entity is such a resident within the meaning of that agreement.
(8) Schedule 7, item 1, page 79 (line 5), before "A *financial", insert "(1)".
(9) Schedule 7, item 1, page 79 (after line 9), at the end of section 842-225, add:
(2) Without limiting subsection (1), a sub-underwriting arrangement that is not a *financial arrangement is an IMR financial arrangement if it was entered into by an *IMR entity for the purpose of providing for the entity to invest or trade in a financial arrangement that is an IMR financial arrangement under subsection (1).
(10) Schedule 7, item 1, page 81 (line 9), omit "*independent Australian fund manager", substitute "independent fund manager".
(11) Schedule 7, item 4, page 87 (lines 16 to 27), omit the item.
(12) Schedule 7, item 12, page 90 (line 1), omit "842-209", substitute "842-208".
(13) Schedule 7, item 12, page 90 (after line 21), after section 842-209, insert:
842 -209 Residence of corporate limited partnerships
If an IMR entity makes a choice under paragraph 842-208(2)(c), section 94T of the Income Tax Assessment Act 1936 as amended by Schedule 7 to the Tax and Superannuation Laws Amendment (2015 Measures No.1) Act 2015, applies to the entity in relation to the income years in relation to which this Subdivision applies to the entity.
These parliamentary amendments being made to the Investment Manager Regime are to address concerns raised by industry that certain provisions lack the clarity required to allow Australian fund managers to take advantage of the IMR concession as intended. These concerns were raised with the Senate Economics Legislation Committee. Significantly, changes to the schedule ensure that sub-underwriting arrangements will be covered regardless of the outcome of the arrangement. The reference to 'permanent establishment' clearly refers to either the relevant international tax agreement or the definition in the Income Tax Assessment Act 1936. In satisfying the widely held requirement, any independent fund managers may disregard any entitlement provided that the entitlement is taxed in the year it is received. There are other technical drafting errors that are also being corrected to avoid the need to make future amendments in parliament. In addition, and consistent with the Senate Economics Legislation Committee recommendation, a supplementary explanatory memorandum has been revised to provide industry with further clarification to cover certain terms and concepts. As the IMR seeks to remove uncertainties in Australia's tax laws, these changes will ensure that foreign investors can invest through or into Australia with tax certainty and that Australian fund managers can actively market their financial services globally.
Question agreed to.
Bill, as amended, agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
The Excise Tariff Amendment (Ethanol and Biodiesel) Bill 2015 reforms the taxation treatment of the biofuels ethanol and biodiesel. It has profound implications for this industry. This is a good industry and it is an industry which has grown rapidly in the course of the past 20 years. It is an industry that has deep roots in regional Australia. And it is an industry that will sigh a sigh of relief with the passage of this legislation, bringing forth, as it will, a further amendment from the government to phase in, over a period of 15 years, a range of changes that will further create certainty for, specifically, the biodiesel industry. As part of this reform, the Energy Grants and Other Legislation Amendment (Ethanol and Biodiesel) Bill 2015 will abolish the Cleaner Fuels Grants Scheme. Labor supports these bills and their intent to create a sustainable taxation framework for biofuels.
Biofuels play an important part in our economy, and we expect in the context of transport fuels that the role played by biofuels will increase. We see that as being a good thing for our regional economy in that it adds value to feedstock for the biofuels process. That feedstock can originate in abattoirs; it can originate in communities by way of hydrocarbon-based products that are gathered in networks and delivered to these biodiesel facilities. It will bring on an industry that will add just a little more security to our transport fuel sector. It will also add a little cleaner feedstock for our transport fuel sector and it will create an economic value for the feedstock that is provided for biodiesel and, of course, in the ethanol process too. Adding that economic value is important, because that allows, in and of itself, the construction of markets and supply chains to bring feedstock into our biofuel processing facilities around the country.
Some 95 per cent of all energy consumed for transport in Australia was crude-oil-derived liquid fuels in 2011 and 2012. Our transport fuel sector is absolutely dominated by crude-oil-derived liquid fuels. Despite the dominance of petrol and diesel, alternative fuels have an important role to play. 'Alternative fuels', including biofuels, refers to fuels other than petrol and diesel that can be used in internal combustion engines. The product of biodiesel plants and of ethanol plants provides—when blended with petrol feedstock—a blend which has a substantial place in the Australian transport fuels marketplace.
As I said, 'alternative fuels'—of course, including biofuels—refers to fuels other than petrol and diesel that can be used in internal combustion engines. This also includes other fuels like compressed natural gas, liquefied natural gas, liquefied petroleum gas, hydrogen, methanol and biogas. We are at the point where we are now seeing in our transport logistics industry a substantial amount of research and investment taking place in alternative transport fuels. This is important for the future development of our technology base and the future development of our logistics base. We are seeing it in extractive industries—in hard rock mining and iron ore mining in particular—with the development of gas-based truck propulsion systems and gas-based static power generation systems. This is all part of the very healthy movement that we are seeing throughout our economy and throughout the logistics of transport and energy generation—moves to other, more appropriate, better-priced and environmentally-better fuels that, on occasion, bring with them a range of ancillary benefits, such as those I referred to earlier that have helped develop a good economic base in the regional centres that supply the feedstocks for our biofuels industry.
Apart from the energy diversification benefits that can be gained from alternative fuels, there are environmental benefits from the renewable nature of biofuels. These benefits should not be missed; they should not be overstated, but they should not be missed. Biodiesel can be produced from renewable biological sources, such as vegetable oils, animal fats and recycled greases—such as cooking oil—and there is potential for other feedstocks, such as algae. It is in this area of 'other feedstocks' that substantial research is occurring both in Australia and throughout the world, looking at those carbon-based biological feedstocks that can add material to produce liquid fuels which fit current logistics capabilities and current transport technologies and which behave in a way that is identical to or even better than existing diesel and petrol-based transportation fuels.
What I mean by that is we can see the development of these alternative technologies bringing with them a very substantial benefit to a country such as ours, which relies to such a great extent on the integrity of its transportation systems—and therefore on the integrity of its fuel management and delivery systems, and the security of those systems. So: in addition to being able to provide the motive of energy, in addition to being able to provide a substantial regional economic benefit and in addition to being able to provide some renewable benefit into this transport sector, we see this cycle being developed around biofuels and ethanol that is wholly good for our Australian industry, for our regional economies and, in particular, for our farming communities that substantially provide the feedstocks for these biofuels. Ethanol, of course, can be produced from biomass, normally via a fermentation process from the waste products of cane sugar, from grains such as wheat or sorghum and from forest products.
Domestically produced and imported biodiesel and ethanol are currently subject to the same rate of excise as petrol and diesel. However, producers and importers are able to access a grant for the full amount of duty paid. The Cleaner Fuel Grants Scheme refunds excise and excise equivalent customs duty paid on both imported and domestically produced biodiesel. The legislation we are debating today will end that scheme.
Similarly, the Ethanol Production Grants Scheme, which refunds excise paid on ethanol to domestic producers, will close at the end of this month. In place of the Cleaner Fuel Grants Scheme and the Ethanol Production Grants Scheme, the excise payable on the domestic production of biodiesel and ethanol will be reduced to zero and will then gradually increase to a reduced rate. The new excise rate for biodiesel will reach 50 per cent of the full rate of excise that applies to petrol and diesel, and the new rate for fuel ethanol will reach approximately 33 per cent of that rate.
It is important to note that imported biodiesel and ethanol will be subject to the full fuel duty rate. This will give a comparative advantage to our local industries. This bill, and the amendments that will follow, is supported by the Australian biofuels industry because it does create a better competitive environment and a greater level of certainty for Australian producers. That goes to the point of the comparative advantage that that particular mechanism, which I have just mentioned, delivers.
The government will be introducing an amendment to this legislation, which will see a longer transition process for the biodiesel industry. I thank the Minister for Industry and Science, and his office, for working to ensure that the biodiesel industry will be given enough time to adjust to this new taxation framework. The discussions that we have had office to office have been both productive and frank. And they have allowed us to arrive at a minor improvement, at minimal cost, that will create a greater level of certainty that will allow us, amongst other things, to pass this legislation by 30 June, which is a critical part of both creating the certainty and meeting the legislative deadline which the government has been operating to.
Biodiesel does make an important, albeit small, contribution to our liquid fuels mix. It is understandable that it will be a small contribution at the moment, given the nature of the refining industry, the certainty that has to flow back into the sector and the impact in recent times on crude oil based transportation fuel production, which has seen—over the course of the last eight or nine months—a substantial drop in global oil prices, which is reflected in diesel prices delivered to the bowser in Australia and to the industries which are such large users of diesel fuel: our off-road sector, agriculture, fishing and mining.
With that reduction in global hydrocarbons prices, we have seen a particularly tough competitive environment being delivered at the bowser in which biodiesel and ethanol have had to compete. But we are now seeing some return to buoyancy in global oil prices and that is being returned at the petrol pump with increased prices for transportation fuels in Australia. In that cycle we will see, we believe, the genuine impact of these fuels adding to that mix.
In the West Australian context, I had the great pleasure, just two years ago, of visiting the biodiesel plant at Picton near Bunbury where it is hoped that a biodiesel feedstock can be provided to the BP refinery at Kwinana to add a biodiesel component to diesel produced from the Kwinana refinery. This would add to that virtuous cycle of an economic value being delivered to farmers and feedstock providers at Bunbury and Picton. The generation of a very good biofuel through that facility at Bunbury and Picton, delivered to the diesel refinery at Kwinana and then delivered for use in transport fuels to the greater Perth community is a good example of how this industry can grow and work to the benefit of all Australians and to the great benefit of our industrial and transportation users.
The share of domestically produced biodiesel had been declining at the expense of imported fuel while imported fuels prices had been falling. That has been a significant challenge for the industry and it is hoped that the comparative advantage through the reduced excise rate, as well as the longer transition path to reach that rate, will protect our local industry as well as adding some buoyancy to global hydrocarbons markets.
The opposition will continue to engage with the industry and to monitor the pathway to the 50 per cent excise rate to ensure that the needs of the industry and the government's budgetary position are taken into consideration while, at the same time, we see a growth in this industry and certainty being restored to both biodiesel producers and producers of the feedstock that is so important to this industry.
Throughout Australia, we see biodiesel production facilities in regional Australia. It is a particular regional Australian benefit that occurs from this industry. Deloitte Access Economics reported in February of last year that the domestic biodiesel industry has made a total contribution to the Australian economy of $64 million and has supported in excess of 400 full-time equivalent jobs net of all subsidies. Significantly, almost all of those jobs are in regional Australia.
I have mentioned the importance of Picton in Western Australia. I have not mentioned Barnawartha in Victoria, Largs Bay in South Australia and Rutherford in New South Wales. Eco Tech Biodiesel has a plant at Narangba in Queensland and we also have a biofuels non-operational plant in the Northern Territory. The extent of this footprint of biodiesel and the importance of the ethanol industry in regional New South Wales should not be missed on members of this parliament. The value of this industry in producing an alternative transportation fuel stock and feedstock that can add value to regional agricultural production and biofeedstock for our regional biodiesel production facilities should be greatly supported and is something that we should look forward to as the impact of this bill and the longer transitionary period work their way through. We should be conscious at all times that from time to time Australian governments do need to change legislative frameworks to fit the budget requirements of the day and of the moment. I deeply respect the government's work to attend to those issues through this bill and of course accept that a future government may also need to make such decisions. I commend this bill to the House.
The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour.
Last weekend I was very pleased to attend the opening of the Regional Rail Link in Melbourne's west, a joint venture of state and federal Labor governments that began during the height of the Global Financial Crisis in 2009. The Regional Rail Link project is the biggest Commonwealth investment in public transport infrastructure in our nation's history. And the benefits are clear: the project adds 54,000 passenger seats per day; it services the regional centres of Ballarat, Bendigo and Geelong; 15,000 Victorians worked on the project; and it will save millions in wasted commuting time—a great Labor project for Victoria.
The opening was attended by the Premier, Daniel Andrews, and a bevy of state and federal MPs including the members for Lalor, Corio, Bendigo, Grayndler and the Deputy Prime Minister—he took centre stage at a project unveiling he had nothing to do with and had voted against in opposition. When asked about the government's position on funding the next necessary public transport project in Victoria, the Melbourne Metro Rail project, he forgot his lines and went rogue. He said, 'We will probably receive approaches in relation to that project. If we receive those approaches then we will have them assessed by Infrastructure Australia and make a decision.'
The problem is that the Prime Minister is singing a very different tune. He told 3AW earlier this year:
We do not fund urban rail projects; we fund roads of national significance and we fund nationally significant freight rail projects but we don't fund commuter rail.
This government should start getting itself in order by leaving its antiquated ideology at the door, heed the advice of Infrastructure Australia, and support the next big public transport infrastructure project for Victoria—the Melbourne Metro rail tunnel.
Limbs 4 Life is Australia's peak organisation for amputees and persons with limb difference. This month, they launched a new program—Limbs 4 Kids. For the first time, all Australian children and young people with limb differences and those who care for them have a program and a website to call their own—www.limbs4kids.org.au. It is a source of great information, contacts and resources for parents and healthcare workers who care for children and young people who are born with a limb difference or who have had a limb amputated during their childhood. The website features a learning centre, online forum, stories, videos, and Thrive magazine, together with networking and training opportunities.
Australia is estimated to have over 2,500 children and young people with a limb difference. My beautiful grand-daughter Sarah Victoria is one of them. Sarah was born with a missing forearm as a result of the umbilical cord cutting off the circulation in-vitro. Sarah has not let this stop her in life. She is as active as any other child and enjoys riding horses and quad bikes. She is now 10 years old and wants to be able to ride a dirt bike like her father. She recently tried on her first prosthetic arm, which was very exciting and very successful. She got up for the first time recently with this new arm to ride a bicycle and now she is very confident to getting on these quad bikes. I commend the Limbs 4 Kids program and the Nib Foundation for its generous support.
Bucket loads of resilience are needed by lesbian, gay, bisexual, transgender and intersex community members, their friends and families wherever they live but most particularly in rural Australia. Imagine the fear and distress that faces a young person who lives in a small country town or on a farm and who is confused about their gender or sexual identity. Young people tell me of the barriers they face in their homes, schools and in the wider community. Everyone knows them and they may feel there is no-one to turn to, no-one will understand and, if they do not have family support, they often feel isolated and alone.
Today I am pleased to say that in my electorate of Indi there is help. Dominic Somers at headspace in Wodonga co-facilitates a group for young people who are transgender or gender questioning. This group shares and discusses issues relating to their gender identity, creates friendships and support. Other support groups include WayOut at Gateway, Alphabet Crew—hi, guys—Hume Phoenix, Albury Wodonga Parents and Friends of Lesbian and Gay and all the local community health organisations who provide support, information and advice, and who listen.
Today in this parliament, I am pleased to be able to say to Ivy and Isabelle, welcome. You belong here and I will stand with you to celebrate diversity and to fight discrimination.
I rise to welcome a senator from Queensland into the other House, Joanna Lindgren. Jo was selected as the new Queensland senator after a marathon six-hour preselection meeting in Brisbane recently. Filling a casual vacancy left by Brett Mason, she is following in the foot-steps of her great-uncle, none other than Senator Neville Bonner. Jo was born and raised in Brisbane and grew up in Inala where her parents continue to live. Jo's parents, John and Gloria, who are in Canberra this week, are factory workers.
Jo attended Brigidine College in Indooroopilly and went on to study an arts degree and received a graduate diploma in education from Griffith University. Jo has worked as a high-school teacher in Brisbane for many years in schools with high proportions of students from low socio-economic backgrounds. It was there that she developed an understanding of challenges facing children from disadvantaged backgrounds and that is what she is passionate about.
In 2010, Jo was appointed to QCAT and is one of only a few teachers who assisted that body in dealing with teacher disciplinary matters. Jo mentioned in her preselection material that a predominant Labor figure had once approached her to join and run for the ALP, but Jo said to the preselectors only a few months ago: 'Don't vote for me just because I'm a woman. Don't vote for me just because I'm an Aboriginal. Vote for me because I can make a difference to Queensland.'
Like the member for Gellibrand, I had enormous pleasure in attending the opening of the Regional Rail Link on Sunday, a project that was jointly conducted by both Labor governments federally and at a state level, a $3.9 billion project. As the member for Gellibrand said, it is the largest public transport infrastructure project in our country's history, a project which employed 15,000 Australians in the building of it. The train line from Geelong to Melbourne, which people are still on until next Sunday, was opened in 1857.
What the Regional Rail Link means is that, for the first time in 158 years, there is now a new train line from Geelong to Melbourne. It is a revolution. That revolution is principally in the degree of frequency that we will now see of trains on that train line. When I meet constituents at train stations, people are often finding that they are having to stand on trains from Geelong to Melbourne. They are often driving away from Melbourne to get the early seats on those trains. Sometimes they take the slower trains to get those seats. This is going to see 200 new services every week between Geelong and Melbourne at 10-minute intervals during the peak period and 20 minutes during weekdays. This is a revolution for Geelong commuters to Melbourne. It is a great Labor achievement.
I rise today to welcome the parliament passing the government's new era for small business with the passage of the small business and jobs package. It has been well received in my electorate, recognising that most of the employment in my electorate is generated by small and medium enterprises, family businesses—that golden seam of commerce that runs through Australia, providing all of the enterprise, jobs and capacity for this country.
The government's view has been that an instant asset write-off program has to be substantial—in the order of $20,000. I can tell you it has had immediate effect in the local economy of Western Sydney and north-west Sydney. In our local papers today, you will find ads from Nash Patel of The Good Guys, 'Small business tax break deals'. There are plenty of small businesses in my electorate immediately moving to take advantage of this generous program that will see instant asset write-offs.
The Abbott government has also delivered a company tax cut for small business, the first time we have had a lowering of the tax rate for small business, apart from a standard company tax rate, and this is going to be very well received. It is estimated that up to 780,000 companies will benefit from this measure. The best way to create jobs is to build a strong and prosperous economy that encourages business confidence, and of course to do that you have to lower the tax burden on business. Lowering the tax burden, enabling businesses to write off their assets instantly in a substantial way, like this government has done, will see that jobs growth, will see that confidence and will ensure an era of prosperity for small and medium businesses.
I rise to speak about the Regional Rail Link project in Victoria, a project that was opened on Sunday, the largest ever Commonwealth investment in an urban public transport project, a project funded by the previous Labor government. It employed some 15,000 Australians and it was the largest infrastructure project in Australian history in the public transport space—some $3.2 billion. This from a Labor government that invested more in public transport than all other Commonwealth governments combined between Federation and 2007. This is an outstanding accomplishment, separating Melbourne suburban passenger lines from lines serving our regional centres in Victoria, adding 54,000 commuters seats a day, saving the Victorian economy $300 million a year by reducing traffic congestion and lifting productivity.
But, proving that old adage that the Deputy Prime Minister would go to the opening of an envelope, we found him there on Sunday seeking to take credit for a project he himself voted against in opposition. After coming into office, the Abbott government cancelled all of its investment in public transport that was not the subject of existing contracts. That included Melbourne Metro, Brisbane's Cross River Rail, Adelaide's Tonsley Park project and a $500 million allocation to public transport projects. Why? Tony Abbott told us in his political manifesto, Battlelines, that there are not enough people wanting to go from one particular place to a particular destination at a particular time to justify any vehicle larger than a car.
I rise to celebrate more good news about the rollout of the NBN in Corangamite. Today I announce that work has started to deliver the NBN to around 8,000 premises in Torquay and Jan Juc. The NBN's monthly update shows that pre-construction activities, such as preparing pits and pipes ahead of the physical network construction, have also begun in Clifton Springs, Drysdale, Indented Head, Portarlington and St Leonards—to some 14,000 premises. It is important to point out that our fibre-to-the-node technology is delivering average download speeds of 91 megabits per second and upload speeds of 36 megabits per second. Those speeds would enable a household to stream up to 18 high-definition Netflix streams simultaneously.
Under the NBN's 18-month rollout plan for Corangamite, superfast broadband is being delivered to some 35,000 premises across the Surf Coast and the Bellarine Peninsula as well as the Colac Otway and Golden Plains regions. Another 5,000 premises are in line for fixed wireless broadband. And, yes, I continue to push hard to expedite the rollout of the NBN to Belmont, Highton, Waurn Ponds, Marshall and Grovedale, as well as to particularly challenging places like West Bellbrae and Shelford.
Fast broadband is essential infrastructure, and we are very proud we are getting on with the job of delivering this right across Corangamite and the nation.
I was very proud to attend Sunday's opening of the new Regional Rail Link, which untangles the lines used by Melbourne's suburban railway lines from those used by regional services to and from Ballarat, Bendigo and Geelong. This project created 15,000 jobs. It will add 54,000 passenger seats a day to the train system and save the Victorian economy $300 million a year. There are new stations at Wyndham Vale and Tarneit, upgrades of four stations, grade separations, removal of level crossings—this was a fantastic project.
That is why it was so surprising that it was in Melbourne that the Prime Minister made his famous dictum that the federal government does not invest in public transport. All he had to do was to go and have a look at this project—the largest ever federal investment in an urban public transport project in Australia's history. It is consistent with the funding that we put into the Gold Coast rapid transit system and the Noarlunga to Seaford railway line, which are also open.
But on Sunday the Deputy Prime Minister, who is not prepared to fund public transport, was prepared to be there to cut the ribbon. He said there that the Victorian government should submit the Melbourne Metro to IA—it has already been approved by Infrastructure Australia; we already committed $40 million for the planning, which has been done.
I want to report to the House that I conducted two community forums on the drug ice—crystal methamphetamine—in my electorate last week, involving 70 people in Mackay and Bowen who are concerned about the growing epidemic of the drug. The forums included representatives from the Queensland police, Queensland Health, the Department of Human Services; organisations like Drug ARM; local schools, council representatives, church leaders and chaplains; Indigenous groups like Girudala in Bowen; youth groups like Kaylan house and the Youth Information and Referral Service in Mackay; and service organisations like Auscare, UnitingCare, Anglicare and Centacare.
We also heard firsthand accounts of personal impacts that ice has had on local families. It was heartbreaking to listen to parents say that they would prefer to see their children go to jail, where they can get some help, because they cannot force them into rehab.
Participants were very engaged and offered constructive input on tackling the ice problem. The overarching message is the need for a well-resourced, holistic approach to reduce demand, choke off supply and educate the community. It is clear that early intervention is required to prevent that first taking of the drug because it is so addictive and so destructive. It is also clear that, when a victim does reach out for help, that help must be made available immediately.
Feedback from our North Queensland forums has been submitted to the National Ice Taskforce, which will be reporting to the Prime Minister in the coming weeks. We look forward to the forthcoming National Ice Action Strategy, which will result.
I too, like so many on this side of the House, was proud to be part of the opening of the Regional Rail Link. The Regional Rail Link in my part of the world will make a difference. In the seat of Bendigo there are six train stations. They are in parts of a commuter town. We are talking about Castlemaine. We are talking about Woodend, Kyneton, Malmsbury and Macedon. They will all have more services. More people will be able to get to work on time. More people will be able to travel to Melbourne and get there on time.
What is so critical about this project is the fact that it untangled the regional rail network from the metro network. Not only does it mean that we will have more regional rail services connecting people from the regions to this city, but it also means that we will be able to have more metro services.
The solution to our problems when it comes to congestion is investing more in public transport, whether it be supporting regional rail or supporting metro rail. What we have seen from Labor governments, state and federal, is that critical funding and that critical planning. What we have not seen from this government or from Liberal governments is funding—funding to go towards infrastructure projects like public transport. Instead, they have cut. They have taken money away, putting pressure on the public network system. What this government needs to do is get behind public transport, stop cutting ribbons and start investing in public— (Time expired)
Today in the chamber we will have students from St Joseph's school, Bardon, join us for question time. When I visited them last week, I challenged them to draft a 90-second speech about our local community. I now congratulate Ella Patterson and Lily Shortis, who asked that I draw our attention to the 2015 Vinnies CEO Sleepout.
Ella and Lily remind us that more than 100,000 people experience homelessness in Australia, with more than 19,000 in Queensland alone. Half the people affected by homelessness are women, and a quarter are under the age of 18. Think of how often you contact your friends, family, colleagues and neighbours. What if you did not have this? For many Australians this is nonexistent, leaving them isolated and unloved.
Over the past 10 years, the Vinnies Sleepout has raised around $24 million. Funds donated will help to provide emergency assistance and pathways to a brighter future and help people break the cycle of homelessness. The aim this year is to raise around $10 million.
Helping the homeless is everyone's responsibility. The inspiration that we need is all around us. Business and community members are invited to rise to the challenge and experience what it is like to sleep rough for one night. On that night people are offered a sheet of cardboard for a bed, a cup of soup and a warm drink. By getting involved you will be raising awareness about the issue of homelessness. Ella and Lily quote Mother Teresa, who said, 'If you can't feed a hundred people, then feed just one.'
It will be no surprise to anyone in the chamber that I rise today to speak about the Regional Rail Link. I do so with great pride, being the member for Lalor, where two of the new stations are situated. This initiative will make a difference to people's lives in my electorate. I have spoken before about catching the train to and from Melbourne recently and the number of times I have listened to conversations around me in those jam-packed carriages in peak hour, talking about the great day when the Regional Rail Link will open. That day is fast approaching.
On Saturday, there were 2,000 people—2,000 people!—at a community day at the Tarneit station, which of course we visited on Sunday. We were joined by the Premier of Victoria, Daniel Andrews, of course, and by Minister Jacinta Allan, and we were also joined by the deputy leader of the government. The Deputy Prime Minister came to open this great Regional Rail Link. Let me say: he was very pleased to be there, as the photos attest, with a smile from ear to ear—so excited to be part of a project that was building stations for people to use from next week. He was thrilled, very thrilled, to be there.
It is going to make a difference for the people in my electorate—an enormous difference. We have thousands of people who have been travelling for up to 40 minutes to get to other stations. This is great news for Victoria. Those opposite should get on board.
I want to acknowledge a remarkable woman in my electorate of Bass who recently received well-deserved recognition for her commitment to her family in the face of challenges that very few of us have to deal with.
Lisa King of Launceston is a teacher and mother of four sons. Tragically, her second son, Noah, was born with a terminal brain condition and was only expected to live for a few years. With the love and care of his parents, Noah made it to his 10th birthday before his body gave out. Three months after Noah passed away, Lisa's husband, Aaron, died of a heart attack at the age of 39. It is hard to image the unbearable hardship of two such devastating blows in such a short time. However, Lisa's courage following these events inspired her community and touched our hearts.
In April this year, she was named Barnardos Tasmanian Mother of the Year and was a runner-up in the national award. While continuing to raise her sons, Jalen, Harri and Kobe, Lisa had the strength to support others facing tough times. Her blog, The Kings, has provided comfort and hope to many people, and she has been twice voted Australian Mum Blogger of the Year. Reeve McLennan, Lisa's friend who nominated her for the Barnardos award, said that despite the tragedies in her life she continues to be upbeat and positive and to think of others. Lisa King is not only the rock of her family but an inspiration to us all.
It will come as no surprise to those opposite or in fact those here that I rise also to speak about the opening of the Regional Rail Link. This is a tremendous initiative dealing with congestion on the public transport network in our second biggest state, which has the metropolitan area that will in fact, in the years ahead, overtake Sydney and be the largest metropolitan area in this country.
It is a tremendous project that goes to the question of dealing with what is occurring in our regions as well as the needs of metropolitan users. It will produce significant improvements in the system both in terms of travel times and in terms of the total number of passengers that can be dealt with. And it is something about the future. If we do not deal with the public transport issues in regional and metropolitan areas of this country, we are going to have massive issues in the future. That is why this government needs to think about the importance of public transport in an overall approach to dealing with transport issues across this nation.
One of the problems we have is a Prime Minister who wrote in his manifesto Battlelines that it was all about cars and nothing about anything else. He has taken this into government and now we are seeing that if the situation is about infrastructure, they will say, 'Put it up to Infrastructure Australia.' But if it is not about roads and bridges, they are not interested. The Deputy Prime Minister did attend on the weekend—I understand that, it is Commonwealth money involved. But let's be clear about that: Commonwealth money committed by Labor.
Recently, Rockhampton, the true beef capital of Australia, in Capricornia, hosted our nation's biggest cattle industry expo, Beef Australia 2015. This event was the most successful ever held in showcasing our beef industry to the world. Beef Australia's chairman Blair Angus and his committee, together with CEO Denis Cox, the Beef Australia staff and all of the volunteers that acted as beef week ambassadors have made Australia very proud on the world stage. Up to 90,000 people attended Beef Australia, including visitors from 25 countries. I am proud that our coalition government contributed $2.5 million to help stage this event.
Beef Week provided a $40 million direct boost to the local retail, food and hospitality, transport and accommodation sectors. However, the final spin-off to our nation could be worth hundreds of millions of dollars. Our beef sector employs 200,000 people. Its importance is reflected by the number of senior federal government members who visited Beef Australia. I thank the Prime Minister, Deputy Prime Minister, federal agriculture minister and Deputy Speaker, amongst others, for their attendance at this very important event.
I, like everybody else on this side of the House, was wrapped on Saturday night to see so many people on a train ride in outer metropolitan Melbourne, in a regional area—people on a train. People actually like to catch trains, they are not always wanting to be in their cars. Unlike the Prime Minister, who wrote in Battlelines:
Mostly there just aren't enough people wanting to go from a particular place to a particular destination at a particular time to justify any vehicle larger than a car and cars need roads.
Has he been on a train line recently? Has he sat on the Dandenong line? Has he sat on the Waverley line? Has he sat on the Belgrave line? All these service my electorate and all are completely overcrowded. This is a government that said the last state election was a referendum on the East West Link. If it was, they lost. They lost that referendum.
Then the Prime Minister said, 'Victorians elected their new government in a fit of absentmindedness.' How absolutely demeaning. And then we got the federal budget that was meant to be about infrastructure which is only delivering $400 million to Victoria for infrastructure. That is a measly eight per cent of the federal government's infrastructure budget and a measly $67 per person in Victoria—the second most populous state, about to become the most populous state. Victoria needs infrastructure. It needs rail. It needs metro rail. It needs the assistance to get on and to move people around our communities.
Last week, I had the pleasure of welcoming the Minister for Justice, the Hon. Michael Keenan, to Swan to co-host an important round table with community and experts from across Swan which was aimed at combating the scourge of ice, or crystal methamphetamine, which is harming so many communities across Australia. I know there is strong support from the opposite side of the House for this taskforce as well.
As members know, the Prime Minister announced the establishment of a National Ice Taskforce to address this growing problem earlier this year, and round tables such as the one the minister and I co-hosted will help inform the task force as to the areas where efforts should be concentrated to combat its use and different strategies which could be implemented. Two local police sergeants attended from my electorate who stated that they are finding 'more mums and dads cooking meth because it is profitable'—it helps them pay the bills—and that about '80 per cent of people local police come into contact with are on drugs such as amphetamines and are often aggressive and unpredictable'. These statements are staggering, but they also distinctly highlight why this task force, which Minister Keenan is overseeing, is so vital.
In Swan, stakeholders overall agreed that to combat the prevalence of ice more work needs to be done to stop the supply, there needs to be a greater focus placed on education and early prevention, particularly in primary schools, and there needs to be a more collaborative approach implemented between the different sectors. I have provided this feedback to the task force and look forward to strategies such as this being implemented as part of the government's National Ice Action Strategy.
I rise to talk about the opening on Sunday of the Regional Rail Link in Victoria, a magnificent piece of infrastructure, a magnificent piece of investment in our state. I am glad to say that the Deputy Prime Minister turned up to open something he voted against in the parliament. Indeed, the Regional Rail Link is the biggest Commonwealth infrastructure investment in Australian history—$3.225 billion. Labor MPs were there and the poor, lonely Deputy Prime Minister, the Minister for Infrastructure and Regional Development, was there to open it. But of course we will not see one more cent spent on infrastructure and rail in this country as far as this government is concerned.
We have a Prime Minister who likes to describe himself as 'the infrastructure Prime Minister'. But, of course, by failing to continue to invest in the Regional Rail Link, this government has failed not only Victorians but citizens around this country in relation to regional rail. On this side of the House, we will always invest in regional rail, in metro rail and in public transport because that is what is needed for this nation. The infrastructure Prime Minister, so-called, should start rethinking his position on this investment. It is vital for this country's future. (Time expired)
I wish to highlight an exciting new 'app-treneur' from my electorate of Tangney. Richard Meyers has an app to kick-start tourism in our regional cities and towns. Tourism is an exciting part of the bridge to the high-valued added, high-productivity, innovation economy. Richard is exactly the type of person we are more likely to see in this new economy. He is a mature worker with a plethora of commercial skills and life experience, and is seizing the opportunities of the app revolution. Not everyone can be an app developer, but everyone can have a big idea—a big idea like Richard's Aussie Tourism Apps. This app is the loyalty card for shires and regions. It rewards visitors for staying and playing in an area. It rewards with ease of use and access with information on today's specials. Remember, you heard about Richard Meyers, the 'app-treneur', and the Aussie Tourism Apps here first.
It being 2 o'clock, in accordance with standing order 43, the time for members' statements has concluded.
My question is to the Prime Minister. For 18 months the government has been talking about stripping citizenship from dual citizens yet no legislation has been introduced. In fact, the only document we have seen is a leaked, blatantly political, confidential briefing. Giving that this briefing betrays bipartisanship on national security matters, why is the government trying to destroy bipartisanship rather than working together on national security?
Opposition members interjecting—
There will be silence on my left! That includes the Deputy Leader of the Opposition.
I should correct some factual inaccuracies in the Leader of the Opposition's question. I first said that the government would move down this path in February, so some four months later—
Mr Dreyfus interjecting—
The member for Isaacs will desist.
we made a commitment to bring legislation into this parliament. In this sitting fortnight legislation will be brought into this parliament to strip citizenship from terrorists who are dual nationals.
Ms Chesters interjecting—
The member for Bendigo will desist.
It is a very sensible thing to do—to strip citizenship from terrorists who are dual nationals—because if someone leaves this country to fight with a terrorist army in Syria and Iraq we do not want them back. We do not want them back. That is why we are so determined to strip the citizenship from terrorists who are dual nationals.
Mr Perrett interjecting—
The member for Moreton is warned!
It is a very simple proposition. The legislation will be before this parliament in this sitting fortnight. The Leader of the Opposition and any other members of the opposition who wish to be briefed will be briefed. The legislation will go off to the Joint Committee on Intelligence and Security.
Madam Speaker, I have a point of order on relevance. I asked the Prime Minister: why are you trying to destroy bipartisanship on national security?
The member will resume his seat. The Prime Minister has the call.
I appreciate the interjection of the Leader of the Opposition because it gave me an opportunity to get to my briefing notes and remind members opposite—
Opposition members interjecting—
There will be silence on my left. That includes the member for Corio.
that in fact what we are doing is precisely what was recommended by the Independent National Security Legislation Monitor, as Madam Speaker so well reminded us all last night on Q&A. Bret Walker SC said:
Consideration should be given to the introduction of a power for the Minister for Immigration to revoke the citizenship of Australians … where the Minister is satisfied that the person has engaged in acts prejudicial to Australia’s security and it is not in Australia’s interests for the person to remain in Australia.
That is exactly what we are doing. We are acting upon the recommendation of Bret Walker SC. That is what we are doing because we will never rest until we are confident that the Australian people are as safe as we can make them.
Madam Speaker—
Is the member rising on a point of order?
I seek to table the 20 January 2014—
No. The member will resume his seat. There is no leave given.
My question is to the Prime Minister. Will the Prime Minister update the House on how small businesses in my electorate and around Australia can take advantage of the government's small business tax cuts? How will this tax relief support jobs and growth?
I thank the member for Eden-Monaro for his question. I was pleased to go with the member for Eden-Monaro and Senator Seselja today to Better Trailers in Fyshwick.
It's not in Eden-Monaro!
This business is booming thanks to the best budget ever for the small businesses of Australia.
Opposition members interjecting—
I think we have got enough hilarity. I think everybody gets the Fyshwick joke.
They are so amused. If the member for Canberra knew her electorate better, she would realise that lots of people from Eden-Monaro work in Canberra and lots of people from Eden-Monaro work in Fyshwick. I was delighted to be with the member for Eden-Monaro and Senator Seselja at Better Trailers today, because business is booming thanks to the best budget ever for small business.
Mr Perrett interjecting—
I remind the member for Moreton, but not again.
I caught up with some of Tony's tradies who are taking advantage of the instant asset write-off to invest in their business, to help their staff and to serve their customers. There are two million small businesses right around Australia that are taking advantage of the instant asset write-off to invest in their businesses, to help their staff and to serve their customers. That is just what good government does. It backs the people in this country who are having a go to do the right thing by themselves and our community. Scott and Janine McPherson, who run Better Trailers, say that customers have brought forward their orders to take advantage of the instant asset write-off. There was Jeoff Noja from Brighter Building Solutions, who not only has bought three utes under the instant asset write-off but also is buying new equipment and improving his business.
Right around Australia, that is exactly what is happening, because this is a government which is open for business. We have abolished the mining tax, we have abolished the carbon tax, we have cut $2 billion from business red tape costs, $1 trillion worth of new projects that will be good for big business and small business have received environmental approval, the biggest infrastructure program in Commonwealth history is now underway, and there are three free trade agreements which will mean that 95 per cent of our exports to China, to Japan and to South Korea will soon be tariff free. So this is what happens when you have a government which is open for business and when you have a government with a plan to deliver a safe, strong and prosperous future for everyone.
My question is to the Minister for Immigration and Border Protection. I refer to the government's blatantly political confidential briefing note on the revocation of Australian citizenship, which states:
A law requiring a terrorist conviction would be toothless.
Can the minister confirm that, under his citizenship proposal, he as minister will make the decision to revoke Australian citizenship from a dual citizen suspected of fighting against Australia?
Honourable members interjecting—
We will have some silence for the answer.
Let me go to Bret Walker's report and what he said in his report. If I go to page 57, Bret Walker SC says:
Taking into account Australia's international obligations, and the national security and counter-terrorism risks posed by Australians engaging in acts prejudicial to Australia's security, the INSLM supports the introduction of a power for the Minister for Immigration to revoke the citizenship of Australians, where to do so would not render them stateless, where the Minister is satisfied that the person has engaged in acts prejudicial to Australia's security and it is not in Australia's interests for the person to remain in Australia.
That is exactly the principle by which we are guided. As the Prime Minister has said, and as all of us in this government have said repeatedly, we face an unprecedented threat from terrorism in this country. ASIO advises us that there are 400 high-priority cases under investigation right now. We have over 110 Australians who are fighting in Syria and the Middle East and about whom we are very worried that, if they came back to this country, they would seek to cause mass-casualty events here in this country. We have to deal with the reality of this threat.
I do not know why Labor is in denial when it comes to these issues of national security. The opposition leader, sitting in that chair—
Ms O'Neil interjecting—
There will be silence on my left. The member for Hotham is warned.
only a week ago said that the government's strong reaction was a dog whistle. That is what he said: he said that the action that we are proposing in relation to stripping citizenship from dual nationals—those who are involved in terrorism—was a dog whistle.
Ms Owens interjecting—
The member for Parramatta is warned.
But he backflipped 24 hours later when he realised that that position was not sustainable. What this government will do is to provide whatever support we can to our intelligence and law enforcement agencies to stare down the threat of terrorism. I welcome any question whatsoever from the opposition in relation to this very important matter, because this government will stare down the threat that is posed to the Australian public as best we can. We have demonstrated that in securing our borders. When Labor were in government, they had completely and utterly lost control of our borders, and if you cannot control your borders you cannot control national security.
My question is to the Treasurer. Will the Treasurer outline to the House the steps government is taking to help Australians who want to get out there and have a go? How will the passage of key business measures help create growth, jobs and opportunity?
I thank the honourable member for Gilmore for that outstanding question, and I readily recognise that she has been doorknocking her electorate and the overwhelming message that she has been getting is that there is a great deal of optimism about what has come out of the budget. There is a great deal of optimism about what is in it for small business, and of course that is reflected in some of the confidence indexes that have been released today. The ANZ-Roy Morgan Australian Consumer Confidence Index came out today:
The bounce in employment numbers and the fall in the unemployment rate seems to have sent a positive signal, which is being reflected in consumers view towards future financial and economic conditions.
So that is good news. Commsec's Craig James said:
If you take a longer term perspective, confidence is up on a year ago, up on the short-term average reading and up on the long-term average.
That is all good news, and it is reflected in the Reserve Bank minutes that were released today, where the Reserve Bank noted:
Measures of consumer sentiment had picked up noticeably in May to be a bit above average. Much of this had been attributed to the Australian Government Budget and, in particular, the announcement of tax concessions for small businesses.
So that is all good news as well. So the good news is building. We are getting better employment numbers, we are getting better growth numbers and business is going out and having a go.
In fact, the member for Gilmore said the mood in the electorate amongst small business is electric. She identified a cafe owner in Nowra who now, as a result of the $20,000 instant asset write-off, wants to buy a new high-volume kitchen oven. A local tourism operator in the Kangaroo Valley is going to go out and buy a new coffee machine for the business. A local beef farmer just outside Minnamurra is going to buy a new water tank. And the list goes on. In fact, there are facilitators for this as well. TCC Accounting Services, which is based in the village of Milton near Ulladulla, is run by a Mr Peter Campbell, and he says, 'We're running seminars for small business so they don't miss the opportunity associated with the budget.'
There is no doubt that the budget has made a difference to small business confidence and to consumer confidence. There is still much work to be done, but Australia is on track. The economic plan that the Prime Minister was talking about a few moments ago is on track. We are getting rid of the regulation and red tape that has been strangling small business, we are cutting the taxes, we are opening up the free trade agreements, we are building record levels of infrastructure, and as a result of all that Tony's tradies are going out and having a go.
My question is to the Minister for Immigration and Border Protection. I refer to the minister's previous answer. Why did the minister, in referring to the former Independent National Security Legislation Monitor, fail to refer to his comments yesterday that it was 'constitutionally unthinkable' to revoke a person's citizenship without a conviction and that he 'never dreamed it would be possible'?
I thank the member for his question. I do not know how you could read into this recommendation those words. I can read directly from the report. I can read the honourable Mr Walker's own words to you. He says:
… for the Minister for Immigration to revoke the citizenship of Australians—
'where they are not rendered stateless', to paraphrase him—
… where the Minister is satisfied that the person has engaged in acts prejudicial to Australia’s security and it is not in Australia’s interests for the person to remain—
Madam Speaker, I rise on a point of order. In order to be relevant, the minister has to refer to the comments made yesterday by Mr Bret Walker SC, not his—
The member will resume his seat. The minister has the call.
In the end, people will make their own judgements, because in black and white here we have the words of Mr Walker SC. We have no issue with Mr Walker. Our issue is with the Labor Party, because the Labor Party tries to sit on both sides of this debate. That is the problem for Bill Shorten. That is the problem for this Leader of the Opposition. On the government's proposal to strip terrorists of their Australian citizenship if it does not render them stateless, he cannot come in here on one day saying it is a dog whistle and then pretend the next day that he is fully behind what we are doing. He cannot pretend that.
Opposition members interjecting—
There will be silence on my left!
This man has failed every moral test that has been put to him during the course of his working life. That is the reality for this Leader of the Opposition.
Ms Plibersek interjecting—
The member for Sydney will desist!
And he fails this latest test yet again. This government has taken every effort, since we have been elected, to clean up Labor's mess when it comes to national security, when it comes to border security. They in government ripped out over $600 million from our national security and border protection agencies. We have restored funding. We have put counter-terrorism unit officers at our eight airports. Those 80 officers have been involved in hundreds of intercepts of people who would seek to go overseas, who would seek ultimately to come back to do harm to Australians here. And in this latest proposal we are saying to the Australian people, 'Yes, we do recognise, on the advice from the intelligence chiefs, that we face a significant threat from terrorism, but we are prepared as a government to do what it takes, within the law, to protect the Australian people, and we make no apology for it.'
My question is to the Prime Minister. The Iraq war has raged for 12 years and created the circumstances for the rise of Islamic State, and all on the basis of the lies about weapons of mass destruction and Osama bin Laden. Seeing as we helped to start this war and create the Islamic state threat, will you acknowledge the Howard government got it very wrong and agree to a proper war inquiry?
I appreciate that this is a matter which is very important to the member for Denison. I appreciate that he had deeply held views on that particular conflict. I would probably be prepared to concede that he was right to feel a little bruised by some of the treatment that he was given at that time. But I do not want to dwell on the past. I would rather deal with today's problems than yesterday's problems. I would rather prosecute the conflict against the Daesh death cult than try to re-prosecute a fight that is finished against Saddam Hussein. That is my honest response to the member for Denison. I would rather focus on the threat we currently face than on a threat that you can argue about endlessly from a decade or more ago.
I am pleased to be able to say to the member for Denison and members opposite that this government—with, I think, on this matter at least, bipartisanship support—is doing everything we can to disrupt, to degrade and ultimately to defeat the Daesh death cult in Iraq, as we should, because this is a conflict that is reaching out to us here in Australia. It is reaching out to us here in Australia. We know that there are about 110 Australians fighting with terrorist armies in the Middle East. We know that there are about 150 Australians here actively supporting them with financing and recruiting. We know there are some hundreds of high-priority counter-terrorist investigations going on right now against people who have been brainwashed by this death cult.
One of the important ways of countering the terrorist threat here in Australia is to attack it at source in the Middle East, and that is exactly what we are doing. What we want to do is to remind everyone that this is a warm and welcoming society. This is a country which has been happy to accept people from the four corners of the earth to make a home here and to build a better future for themselves and their children—and that, thank God, is what just about everyone who comes here wants to do. I want to say thank you to all the people who have come to this country from other cultures, from other countries, and have joined our team to make a better home here in this country and to make Australia the great country that it is today.
My question is to the Minister for Small Business. Could the minister update the House on how the government's budget is helping small businesses to grow and to create jobs?
What a great question—and an unexpected one, I might say. The member for Lyne asked the question: how does our $5½ billion Jobs and Small Business package help small businesses to start to grow and prosper? All I can say to the member for Lyne is: in so many ways. And that is the reason why in so many ways small business is welcoming what we have done. In the package we have cuts to the tax paid on the income of all small businesses up to a $2 million turnover, regardless of their structure. There are incentives to invest and grow. We are removing barriers to the start-up and the gearing up of businesses.
We are about energising enterprise, and what a great story that is for the more than 10,000 small businesses in the member's electorate—and he has shared with me some examples from his own electorate. Will Frost at Menn-in Trailers has used the $20,000 write-off for office equipment for his business, but he has gone further. He has shared that since the budget announcement he has been 'insanely busy', as other small businesses come in to take advantage of this opportunity. Heather Cooper from MidCoast Irrigation & Horticultural Supplies is currently experiencing what she said is a 'rush of customers' because of the budget measures. This morning, Scott Ramsay of SR Steel, who had been thinking for some time about buying a more efficient punch and sheer machine for his metal business, said—and I will not use his exact words in deference to you, Madam Speaker—that the budget was a boot up the backside to actually turn what he had been thinking about for some time into action. We are understandably positive and up-beat and so are the small business men and women. The Prime Minister is up-beat. There is positivity from the benches here, and my blood group is even positive, we are that excited about it.
But in amongst all that we have some negativity from those opposite. The member for Griffith could not help herself in the Federation Chamber yesterday. She started bagging out anybody who did not realise that two-thirds of small businesses are not structured as small companies. Do you know who does not realise that? It is the Leader of the Opposition who struggled with that simple concept. In his cobbled-together budget reply speech he went out talking about how we have to have small business tax cuts for companies—we have to do this and we have to do that—and he forgot that two thirds of small businesses are not even incorporated. The member went on to describe anyone who did not realise that two-thirds of small businesses are not incorporated as 'buffoons'. That is not a term I would use, but I am concerned somewhat. This seems to be the sequel to the 'Shorten and sharp knives' saga. What is it about the tension between the members for Maribyrnong and Griffith? Can't we get past that in the interests of getting on with the business of this country? It is this side of politics that knew; we know that two-thirds small businesses are not incorporated. That is why we have included measures to deal with that. You can count on us, Member for Griffith, even if you cannot count on the opposition leader.
My question is to the Prime Minister. Graham Ratcliffe is a part pensioner from Glen Waverley in Victoria. Graham writes, 'The government can't claim that its pension changes are fair and equitable and at the same time not address superannuation tax impacts.' Why does the Prime Minister think that part pensioners have too much money and millionaire superannuants too little?
The Leader of the Opposition asked me a question about pensioners. The good news from this government for pensioners is that since the election, the single pension is up by $52 a fortnight and the married pension is up by $78 a fortnight. The carbon tax has gone but pensioners keep the carbon tax compensation.
Ms Owens interjecting—
The member for Parramatta has been warned.
This is a Leader of the Opposition who has seriously lost his way. This is an opposition which is all adrift, because what we saw from the opposition today was a decision that they would deny—
The Prime Minister will resume his seat. The member for Isaacs has a point of order.
Madam Speaker, I rise on a point of order. The Prime Minister is not even attempting to be relevant to the question that he was asked.
There is no point of order. The member will resume his seat.
I was asked about pensioners and that is exactly what I am talking about. Today, the opposition decided to deny to 170,000 people with relatively low assets a pension increase of up to $30 a fortnight. They do not want poorer pensioners to get more money. What they do want is for millionaire pensioners to keep their part pensions. That is what this opposition wants. They want millionaires who also own their family home, people who have more than $1 million in assets plus their family home, to stay as part pensioners.
This is a strange position for the Labor Party and it shows absolutely comprehensively that this is the 'welfare party'; it is not the workers' party anymore. This is so symptomatic of modern Labor, which is the 'welfare party', not the workers' party. They even want welfare for millionaires.
I was asked about pensions and I was also asked about superannuation. Let me make this very clear on superannuation. People's superannuation savings are safe with this government. There will be no adverse changes to superannuation in this parliament. We have no plans to increase taxes on superannuation in any future parliaments and we do not want to increase the restrictions on the way superannuation is used—we don't and we won't. Every superannuant ought to know what will happen if members opposite become the government: Bill Shorten will come after your money. Your nest egg is not safe under this person, who wants to rip off your super, just like he wanted to rip off your unused bank accounts.
Ms Macklin interjecting—
The member for Jagajaga is warned.
Before I call the honourable member for Corangamite, I would like to acknowledge that within our galleries today we have many mayors and general managers of councils who are here for the conference, and I would like to acknowledge them generically. But I particularly would like to acknowledge the mayors from SHOROC—the area shared by the Prime Minister and myself—the mayors for Pittwater, Warringah, Manly and Mosman. We make you most welcome.
Honourable members: Hear, hear!
My question is to the Will the Deputy Prime Minister update the House on the benefits of the government's program of infrastructure development in my home state of Victoria?
Madam Speaker, I ask that you rule that question out of order. The standing orders clearly do not allow irony in a question. Victoria has got eight per cent—
The member for Grayndler will resume his seat. The Deputy Prime Minister has the call.
This government continues to show our commitment to building infrastructure right across Australia, including Victoria. We are creating economic growth with jobs and links to business and to markets. We are delivering through our record $50 billion infrastructure growth package. This government is about building the right infrastructure for our nation's future and supporting urban and regional communities to make sure we are able to travel around our country as we would like to. Work started on 19 new projects in 2014, and another 55 projects are commencing this year. So Australians are reaping the benefits of this budget which has substantial investment in infrastructure and providing opportunity right around Australia.
In the honourable member's own electorate, there has been very substantial work done and there are projects underway. We have just turned the sod on the duplication of the Princes Highway between Colac and Winchelsea—our contribution is $185 million—
What were you doing on Sunday?
The member for Corio!
and the honourable member was present at, and participated in, that ceremony. And we are upgrading the Great Ocean Road, Australia's most notable tourism road—
What about the regional rail link?
The member for Corio is warned!
We have contributed $25 million for a project that Labor opposed; we are getting on with it and doing it. The regional rail link services start this Sunday. The first service on that particular route will leave Waurn Ponds, just outside the member's electorate office, at 6.37 am.
Mr Albanese interjecting—
The member for Grayndler will contain himself!
Labor, of course, destroyed the East West project, with 7,000 jobs lost. The shadow minister foolishly interjected with some nonsense statistic about Victoria getting nine per cent of the road funds.
Opposition members: Eight per cent!
Well, the true figure was 19 per cent in the budget. But that was too much for Victoria! They threw away seven per cent of it—so there is only 12 per cent left—because they did not want to go ahead with the East West project.
Mr Albanese interjecting—
The member for Grayndler!
So this is self-inflicted pain for the shadow minister and self-inflicted pain for Victoria.
Mr Marles interjecting—
The member for Corio, I said, is warned—once more and he will leave.
We are ready to continue to talk to Victoria about what projects might be able to get going in that state. Even if the state government does not want to be involved in the biggest projects in that state, the reality is that many of these big projects cross governments. We did not rip up the contracts that the previous government had signed; we went on building and completing them whereas Labor rips up the project and has got nothing to replace it.
My question is to the Prime Minister. Why is the Prime Minister trousering money from part-pensioners while at the same time failing to address unsustainable superannuation tax concessions for high-income earners?
Opposition members interjecting—
They are very sensitive over there!
Opposition members interjecting—
We know what the Leader of the Opposition—
Opposition members interjecting—
The Prime Minister will resume his seat. We are going to have some silence here. Whatever terms people might choose to use in their question, it is a serious question and we will have some silence for the answer. I give the call to the Prime Minister.
We know that no moneybox was safe when the Leader of the Opposition was in charge of the nation's finances; he would have that moneybox in his pocket as quickly as he could, he would 'trouser' it as quickly as he could. We want to ensure that the pension system is fair and sustainable. It will be a fairer system when 170,000 people of very modest means get an extra $30 a fortnight under this government. It will be a fairer system when millionaires are no longer part-pensioners. It will be a fairer system when people with more than $1 million in assets and their own home are no longer part-pensioners.
What the shadow minister is defending is a system that will take money away from people with modest assets and give money to people who are already millionaires. How lost is the modern Labor Party! I never thought I would say that the Greens are showing more sense on this issue than the Labor Party. But I believe they are. I think even the Greens are more interested than members opposite in sensible pension reform. What this government wants to do is to say to people who have $1 million in assets and their home: 'You no longer need the part-pension. Yes, you'll still get the Commonwealth Seniors Health Card, but you no longer need a part-pension.' If, on the other hand, you have got modest assets—and there are 170,000 of them—we want you to get an extra $30 a fortnight. That is fair and that is sustainable.
When it comes to superannuation, we know that Labor promised to make no changes to superannuation. We know that they then ripped off $9 billion—
Ms Ryan interjecting—
The member for Lalor will leave if she does not remain silent.
led by the Leader of the Opposition, who went after pensioners' piggy banks and sugar jars—wherever they had their savings untouched. He went after them. He could never see a bank account that he did not want to trouser. Well, we say to the pensioners of Australia and we say in particular to the retirees of Australia: your savings are safe with us. We do not see your savings as a piggy bank to be raided by government at need—unlike members opposite.
A question to the Minister for Foreign Affairs: will the minister update the House on the importance of shutting down criminal people-smuggling networks? Why is a consistent approach to this issue important?
I thank the member for Bowman for his question and recognise that he understands the importance of consistency and not hypocrisy in this area. The Australian government remains resolutely committed to the task of preventing criminal people-smuggling networks from plying their terrible trade in our region. The shocking consequences of this trade compelled this government to act decisively, for we must never again allow the tragedy of the 1,200 deaths at sea that occurred under Labor's policies. We must never again allow the criminal people-smuggling networks to decide who comes to this country. And this House should acknowledge the undoubted success of the military-led Operation Sovereign Borders that brought an integrated, comprehensive policy that was required to fix the mess left by Labor. And, under Sovereign Borders, the boats were stopped.
However, yesterday, in a fit of confected outrage, the opposition demanded that the government reveal security or intelligence or operational details of Operation Sovereign Borders. Indeed, the Manager of Opposition Business was literally shouting across the dispatch box. 'A one-word answer will settle this,' he foamed, 'a one-word answer that Australian taxpayers have a right to know.' Yet, later, this very same minister—who is now deeply engaged in conversation which he was not a minute ago—was asked to provide clarification about such matters under the previous Labor government. The shadow minister for immigration and border protection came up with one word: 'unlawful'. He said: 'It is unlawful for the government or the opposition to divulge security or intelligence information.' Oh, is that right! So that was the word was it? 'Unlawful'.
I do not know that members of this House saw the excruciating performance of the Leader of the Opposition about an hour ago, but when he was asked to provide the very same information that had been demanded of the government he refused. So it is okay for the Leader of the Opposition to refuse to reveal operational details but not for the government?
I have some advice to the Leader of the Opposition: I would be very careful to rule in anything or rule out anything under Labor's watch. Do not rely on the advice of your frontbench on ruling in or ruling out security and intelligence matters under Labor's watch. I think you are being set up. And the ducking and weaving just shows the double standards, the hypocrisy and the confected outrage under this disgraceful opposition.
My question is to the Treasurer. I refer to page 4-21 of the Treasurer's own budget paper No. 1 which shows tax concessions for superannuation doubling, over the next four years alone, to $30.4 billion. Given that the Treasurer is so keen to cut pensions for Australia's middle income earners, why is he ignoring unsustainable superannuation tax concessions for high income earners?
It is very interesting, isn't it? Only two weeks ago the member for McMahon said it was 'indefensible' to suggest that we could leave superannuation tax concessions for another day. Now he is changing his wording again. He said it was 'indefensible' to suggest that we can leave superannuation tax concessions for another day. What was the word you just used? 'Unsustainable'? A new change? Another policy change from Labor? 'Unsustainable'? 'Indefensible'? 'Unsustainable'?
The bottom line is: Labor is coming after your superannuation. The bottom line is: Labor wants to tax your superannuation. This man here said—pledged—at the last election: there would be no further changes to superannuation. He said: Labor would not change superannuation for five years. That was two years ago. And Labor have now announced that they are coming at Australian superannuants with a new tax. And he said: 'It is indefensible to keep superannuation as it is for another day.' Labor is coming after your superannuation. Australians have worked damned hard for that superannuation. The Labor Party used to be a friend of superannuation. Now they are the sworn enemy of the superannuation system.
Mr Brendan O'Connor interjecting—
The member for Gorton is warned.
And by their own words and by their own policy decisions, they are coming after the superannuation of every Australian.
My question is to the Acting Minister for Employment. Will the minister inform the House why transparency in the union movement is urgently needed? What action is the government taking to provide it, particularly in my own state of Victoria?
I thank the member for Wannon for his question.
Before the startling revelations that we saw recently in the royal commission into trade union corruption, the government had already acted—already moved—to try to ensure transparency in the union movement and to protect honest union workers and organisers—
On a slalom!
The member for Wakefield is warned! He had been exemplary up to date.
by introducing the Registered Organisations Commission and to bring back the Australian Building and Construction Commission, both of which I unfortunately have to inform the House are being stopped in the Senate by the opposition—by this Leader of the Opposition.
But the government is even more deeply concerned about the most recent revelations in the trade union royal commission. The House will remember the case of Clean Event, which we discussed last time we met. In that case, Clean Event provided $75,000 to the Australian Workers Union in exchange for selling workers down the river to the tune of $6 million in labour costs that they would otherwise have received and the scrapping of their penalty rates.
But even more sinister is the case of Douglas Site Services that we heard about today in the newspapers. In that case, the AWU sought the same arrangement that they had had with Clean Event. And Douglas Site Services refused to sign that EBA—that arrangement with the AWU—and so the AWU refused to sign the EBA into law and Douglas Site Services went out of business.
What!
Douglas Site Services went out of business because of an act of extortion by the Australian Workers Union which Douglas Site Services refused to accede to.
We know that the Leader of the Opposition has some serious questions to answer because in an email sent on 2 March 2006 to Douglas Site Services, John-Paul Blandthorn wrote:
I have spoken to Bill Shorten and he is keen to do a deal but is hoping you may be able to move a little closer to Cleanevent rates.
Later, even worse—admittedly, after the Leader of the Opposition had left the AWU—John Blandthorn wrote again to Mr Hunter, saying:
As discussed Cesar (Melhem) will only sign if we are guaranteed membership though some arrangement.
Now, the Leader of the Opposition needs to explain what he knew and when of these emails to Douglas Site Services and, until he does—
Madam Speaker, I rise on a point of order—about the very process of a royal commission which has been perverted by you—
The member will resume her seat. The minister has the call.
In the seconds remaining, the government wants to help the Leader of the Opposition to make sure that his name is cleared! (Time expired)
My question is to the Prime Minister. The Prime Minister said before the last election—on nine occasions, right up to the Friday night before the election—that there would be no change to pensions. Why is the Prime Minister breaking his promise to 330,000 full and part pensioners?
We are proposing no changes to pensions until after the next election. The changes that we are proposing will make the pension fairer and sustainable.
They will make it fairer, because they will give 170,000 pensioners with modest assets an extra $30 a fortnight, and more sustainable because we will take away the part pension from millionaires who own their own homes and who have a million dollars in assets in addition to that. We are happy for those people to keep the Commonwealth Seniors Health Card, because we appreciate that they have worked hard and saved. But our position is that we should not have millionaire part pensioners.
Well, why didn't you say that going into the election!
The member for Perth will desist! The member for Perth is warned!
If anything could more clearly indicate the wonky moral compass of the contemporary Labor Party it is denying a pension increase to people with modest assets so that millionaires can keep a part pension. That is what they are doing; they are denying an increase in the pension of $30 a fortnight to people with modest assets so that millionaires can keep a part pension. That is what they are doing.
What has happened to the once-great Labor Party that they have found themselves in this terrible position where even the Greens are more economically responsible than they are? That is the position that the Labor Party finds itself in now. They would rather leave millionaires with a part pension than do the right thing by people with modest assets. This is the extraordinary position that the contemporary Labor Party finds itself in. What it all means is that the Labor Party has lost its way. The Labor Party has lost its way, because this man is no leader.
My question is to the Minister for Social Services. How does the government propose to provide a fairer and more accessible pension? And what are the alternatives to this approach?
I thank the member for his question. The answer is that first of all you need to recognise that the pension is a safety net. It is a welfare payment. It is a welfare payment to support and help those who are most in need. That is what it is about. It is a welfare payment for those who need it most.
That is why this government has brought forward measures that will ensure that no longer will someone be able to receive a part pension when they have $1.15 million worth of assets in addition to their family home. That is what these changes will do. What they will also do is to ensure that those who are on low and modest levels of assets will receive an increase in their pension—some 170,000 Australians on the pension and with low and modest levels of assets—of $30 on average per fortnight. And there will be 50,000 additional full pensioners as a result of this change.
And those opposite are voting against that. They are actually voting to sustain part pensions for those with assets of over $1 million in addition to their family homes and denying a pension increase for those on very modest levels of assets. I can tell you why they think that. They think that the pension, on welfare payments, should just go to everybody. They think welfare is a universal thing because they are the welfare party. The Prime Minister says that they are not the workers' party anymore because workers are saving for their retirement. And when they get into their retirement, we are going to make sure that their hard-earned savings in their superannuation will not be the subject of the tax slug that those opposite want to impose, because we understand that when workers save all their lives they build a nest egg for themselves. Those opposite see it as a tax nest—a tax nest for those to plunder.
The shadow minister earlier referred to 'trousering'. The 'trouser bandit' sits over there because he, together with the shadow Treasurer, wants to come after the hard-earned superannuation savings because they do not understand that the pension is not superannuation. The pension is a welfare payment for those who really, really need it. Superannuation is something that people have worked and saved for. They have saved for it. It is their money. And when they have saved, when they have worked, when they have run businesses—
Mr Brendan O'Connor interjecting—
The member for Gorton will leave under 94(a).
The member for Gorton then left the chamber.
and when they have got up every day to go and do their job, what they have done is provided for their retirement. What we are asking those people to do, who have got to that position, is to do just that and live off the earnings and of their hard-earned savings. What we will do for them is: we will not tax them like the 'trouser bandit' opposite.
My question is to the Treasurer. Last week, the Treasurer said, 'The starting point for a first home buyer is to get a good job that pays good money.' Can the Treasurer provide examples of what these good jobs would be that would make average housing in Sydney affordable?
Mr Fitzgibbon interjecting—
The member for Hunter will desist. The Treasurer has the call.
It is hugely important that we all do what we can to increase the supply of housing, particularly in Sydney. It is hugely important. I might report to the House that across Australia construction has commenced on 198,000 new dwellings since the beginning of 2014, which is up 18 per cent on the last year of Labor. In one year there are an extra 198,000 new dwellings that have been commenced in 2014. Nearly 50,000—
Madam Speaker, I rise on a point of order. The Treasurer has been asked to nominate which jobs he was referring to last week when he referred to—
The member will resume his seat. The Treasurer has the call.
In New South Wales alone, 50,000 new houses were built last year. If you are going to borrow money from the bank, the bank insists that you have a steady income and I think we all know that. It is a perfectly reasonable assumption from the banks. We would hope that the banks do not lend to people who are unable to repay that money. That is perfectly reasonable as well. So the best thing we can do to help with housing affordability is to create more jobs—exactly what was reflected in the unemployment numbers that came out last week where the unemployment rate fell to six per cent, which is something that the Labor Party never saw. They actually never saw the unemployment rate fall, because when they came to government the unemployment rate had a four in front of it. When they left government it had a six in front of it and hundreds of thousands of Australians lost their jobs.
As a result of what we have been doing—repairing the economy, repairing the budget, creating confidence out there amongst small business people—you are seeing real job growth. You are seeing real jobs being created and better jobs being created, so people have an opportunity to buy their first home. It is tough in Sydney. It is expensive. It is hard for people to get into their first home in Sydney—as I have said on many occasions—as it is in Melbourne and as it is particularly in some parts of Brisbane. In other parts of the country, in some cases, house prices have even come down. So the best thing we can do for all Australians is to strengthen the Australian economy and give all Australians the chance to get a good job.
My question is to the Minister for Immigration and Border Protection. Will the minister update the House on the humanitarian benefits of the government's border protection policies?
I thank most sincerely the member for O'Connor. He is a great hard worker in his electorate and he is very serious about the issue of border protection, as this government is. We inherited an incredible mess when we came to government. There were 52,000 people who had arrived on 821 boats under Labor. Tragically, 1,200 people had drowned at sea and there had been an $11 billion blow-out under Labor when it came to border protection.
Ms Plibersek interjecting—
The member for Sydney will desist.
We have been able to stop the boats. It is an issue, which of course is ongoing because people smugglers are still lurking in the shadows waiting for Bill Shorten to be elected at the next election. That is what they are waiting for because they know that Labor is weak when it comes to border protection.
We have not had a successful people-smuggling venture to this country in over 300 days and we will continue to work with the agencies to make sure that we can stare down this threat. The Australian public knows that if you cannot manage your borders you cannot manage national security, and I think that is very telling. There is, of course, an enormous dividend because we have been able to—at the same time as we have been able to stop people coming illegally to our country by boat—increase the numbers of people who come to our country under the humanitarian and refugee programs. In actual fact, we will grow the program so that an extra 7½ thousand people will be resettled in Australia over the coming years. In particular—this is a very important point—the government has committed a minimum of 2,200 places for Syrians and 2,200 places for Iraqis in 2014-15. That is the human dividend of being able to clean up Labor's mess—to stop the boats and to stop the drownings at sea.
The Australian public must ask why Labor cannot adopt the successful policies of this government. I will not win the applause of my colleagues here but I want to give the ABC a plug because tonight on the ABC we see the second episode of The Killing Season. There is a sense of deja vue coming across in this place. All of us watched Labor tear itself apart in the Rudd-Gillard-Rudd years and I look across to the smiling assassin. She has her eyes on this bloke. Do not worry about that, Madam Speaker. If people wonder why Bill Shorten is soft when it comes to border protection, they should have a look behind him.
Madam Speaker, I rise on a point of order. The member should refer to members by their correct title.
Fair point, Madam Speaker. The member for Sydney, the smiling assassin—I stand corrected. Let me make this point. If the Australian public cannot comprehend why Labor will not adopt the policies that have stopped the boats, it is for this reason: national conference is coming up and the Left is going to tear him apart.
My question is to the Treasurer. Given the Australian Financial Review reports a first home buyer on their own would need to earn about $152,000 a year to afford an average house or unit in Sydney, how can teachers and firefighters expect to buy their first home in Sydney?
For any individual it is hard in Sydney. I understand that, I know that, I speak to people at length about that and I have been saying that consistently. It is an expensive city. What is interesting is that the Labor Party want to make it harder. Why? Because the Labor Party has now indicated that they are looking at abolishing negative gearing. They have indicated quite bluntly that they want to get rid of negative gearing. The interesting thing about negative gearing is this. Of the people with a taxable income of less than $80,000 per annum, the people who have a net rental loss, that is they use negative gearing, there are 12,300 emergency services workers; teachers and childcare workers, 61,000 have negatively geared properties; nurses, midwives and aged care workers, 42,000 have negatively geared properties; 7,000 cleaners and housekeepers have negatively geared properties; 83,000 clerical staff; nearly 21,600 in hospitality trades; 1,700 hairdressers—et cetera. It goes on and on. Of the people who are using negative gearing to get into the property market in particular in the tax bracket of less than $20,000, 204,000 people have negatively geared properties.
These are the facts.
Madam Speaker, I rise on a point of order on relevance. I very clearly asked about first home buyers and how—
The member will resume her seat. The Treasurer is relevant and has the call.
This is why Labor comes up with these sorts of thought bubbles about negative gearing, capital gains tax, superannuation taxes and so on. There are 383,000 Australians earning less than $37,000 a year who have negatively geared properties. They are using that in a number of cases to get into the market, to get those investment loans, when they may not be able to get a home loan for a particular market. The overwhelming response is not to close down negative gearing, as Labor wants to do; the overwhelming response is to give people the opportunity to get employment and, at the same time, to create more supply in the market. That is the fundamental response and I have been saying it for years. We need more supply in the housing market in Australia and under the coalition the builders of Australia are building and building but we want more, to give more people an opportunity.
My question is to the Assistant Treasurer. Will the Assistant Treasurer update the House on how the government is bringing consistency to superannuation policy and certainty for Australian retirees. Are there any challenges to this approach?
I thank the member for Forrest for her question and acknowledge her deep contribution in this place to protecting the hard-earned savings of ordinary Australians. There are 14 million superannuation accounts in Australia, with some $2 trillion of funds under management, growing to $9 trillion by 2040. What superannuants want is stability and certainty. That is why this government has committed to no unexpected or adverse changes to superannuation in this term of office.
I am asked: are there any challenges to this approach? The greatest challenge comes from the chaotic position on superannuation from those opposite. Who could forget Kevin Rudd's commitment on the eve of the 2007 election not to change superannuation, 'not one jot, not one tittle'. He then gave us 12 adverse changes and $9 billion of additional taxes on superannuation. Who can forget the member for McMahon rushing out that press release in 2013 'No changes to superannuation for five years' and now supporting the Leader of the Opposition with two additional taxes on superannuation and saying recently?
It is indefensible to suggest we can leave superannuation concessions for another day.
The piece de resistance came nearly two weeks ago on 3 June when the Leader of the Opposition, at a door stop, was asked about Labor's superannuation policy and he said:
Labor proposes … if you’ve got $2 million in superannuation and you’re in retirement and you’re earning an income of $100,000 … we’re proposing that you pay a reduction in the tax concession.
I thought, 'That doesn't make sense.' I have got a press release here from 22 April this year from the Leader of the Opposition saying he will put a tax on earnings above $75,000, not $100,000, and above a balance of $1.5 million, not $2 million. I thought, 'Where did that come from?' It was their policy in 2013. The Leader of the Opposition does not even know his own superannuation policy.
We have got a Leader of the Opposition who now wants to raid the piggy bank of retired Australians and who wants to take on negative gearing, and now he does not even know his own superannuation policy. We have got a shadow Treasurer who does not know his own tax scales. We have got a shadow finance minister who last week said business confidence had gone down when it had gone up. And we have got a shadow Assistant Treasurer who says, if we bring back a carbon tax and a mining tax, we will get back to surplus. Labor were an absolute disaster in government, they are chaotic in opposition and, when it comes to Labor's policy on superannuation, do not look at what they say; look at what they do.
I ask that further questions be placed on the Notice Paper.
Madam Speaker, I am using this opportunity to ask you a question in your administration capacity in this place. House of Representatives Practice, at page 146, states:
Members are entitled to expect that, even though politically affiliated, the Speaker will carry out his or her functions impartially.
Given the Prime Minister pointed out in question time your political comments on Q&A last night, was it appropriate for the Speaker to use her role in this place to go into the media to comment on issues which may come before the chair in the future?
The questions that you are entitled under the standing orders to ask me as Speaker are questions relating to the administration. I doubt that that is such a question; however, I will refer you to a different section of the Practice, where it states quite plainly that, in this system of 'Ausminster' which we have here in Australia, the Speaker remains politically affiliated and is impartial in the chair. Being impartial in the chair does not mean giving in to the noisiest lot. Any day that you look at this chamber, it is not hard to work out where the noise comes from. Indeed, when I was in opposition, I was as noisy as you were and I got thrown out very often too. The job of opposition is to make life difficult for the government—we all know that. The job of the government is to explain its policies. I am disappointed that, as a former Speaker, you asked the question in the terms that you did.
Documents are tabled in accordance with the list circulated to honourable members earlier today. Full details of the documents will be recorded in the Votes and Proceedings.
I would also like to report to the House that, last week, the Auditor-General, who had served this parliament extraordinarily well over a long period of time, Mr Ian McPhee, retired. As somebody who worked with him over many years in the public accounts committee and in other ways, I would like to place on record a great deal of thanks to Ian McPhee for the service that he gave to this parliament. I would ask that perhaps the House join me in marking the respect that we hold for him by doing something we do not usually do—a simple round of applause.
on indulgence—I would briefly like to endorse the remarks of Madam Speaker. After long years of service, there can be no doubt that Mr McPhee is a distinguished Australian Commonwealth public servant. The opposition does respect the efforts of all of our Commonwealth public servants, but certainly Mr McPhee deserves the support and acclamation of the entire House.
on indulgence—I would also like to join with you, Madam Speaker, and the Leader of the Opposition in thanking Ian McPhee for his years of service to the country and to the parliament. Governments of neither Labor nor Liberal persuasion always enjoy the reports of auditors-general because they sometimes shine the light of truth on the machinery of government, which is not always pretty, but the role of the Auditor-General is extremely important in ensuring efficacy in government and the correct expenditure of public moneys, which are taxpayers' moneys. We wish Ian McPhee the very best in his retirement.
I have received a letter from the honourable the Leader of the Opposition proposing that a definite matter of public importance be submitted to the House for discussion, namely:
The government's failure to plan for a fair and sustainable retirement for all Australians.
I call upon those honourable members who approve of the proposed discussion to rise in their places.
More than the number of members required by the standing orders having risen in their places—
Australian pensioners be warned: Mr Abbott and the Liberal government are after your part pension and decreasing your pension. Nine times in the last election campaign—not once, not twice, but nine times—Mr Abbott, in his pursuit of the votes of Australians, said: 'There will be no cuts, no changes, to pensions.' He made that perfectly clear—no cuts and no changes to pensions. Mr Abbott looked the pensioners of Australia in the face and he lied to them. He said that he will not change pensions and he absolutely has. The trickiness of the Prime Minister knows no bounds. What he says, to rationalise getting out of his broken promise, is that the changes to pensions will occur on 1 January 2017. Using logic which only the government can be famous for, they say that a lie legislated now is not a lie if the pensioners start losing on 1 January 2017.
Australians know when they have been misled. The government is failing the present and future retirees of Australia, and I can say without any fear of contradiction that Labor will vote against Tony Abbott's new round of cuts to the pension. We will vote against these cuts because 330,000 low- and modest-income pensioner households will lose out. Ninety thousand people will be thrown off their pensions entirely, and what these legislative bullies on the other side say to justify it is: 'Sure, we are flogging 330,000 people. But we are going to make a modest increase to some.' He is effectively daring Labor by taking people on modest incomes hostage and saying his government will not increase their pensions at all unless Labor agrees to support his electoral dishonesty and his broken promises. We will not do that.
We then hear what this government is now world-famous for: when you disagree with this government or when this government wants to justify breaking its promise, it starts attacking you. We heard this fellow, the Prime Minister, get up in question time and say, 'We don't want millionaires to be getting the pension.' He knows as well as I do, and every one of those people sitting opposite should know—although it would not surprise me if some do not know, but we all know not to believe Tony Abbott at least—that he is looking at someone's asset base. But what he does not look at is the income stream from that asset base. He is saying that a person's asset base should be looked at and then he denigrates them. Today, in that shameless, bullying style of this government, he has said that 330,000 people deserve to be taken off the part or full pension and deserve to have their money lost because they are millionaires. The implication is somehow that they are all millionaires.
I will tell you who these people are that they are taking the money from. Let me go through the actual case studies. Facts will always trump the propaganda opposite. These are not millionaires. A single pensioner who owns her own home and is earning less than $25,000 from interest and earnings on superannuation would lose $8,200. This woman will lose almost a quarter of her entire household income. Labor cannot vote for a measure when we understand the misery and the consequences of the measure. She has $25,000 in income. She will lose $8,200. No wonder the government members look surprised. They do not know what they are doing. If they do know what they are doing, that is even worse.
Let me give another real-world cameo. It is not one of Tony's millionaires, who he is so quick to denigrate. These are 330,000 pensioners. A couple who own their own home draw down $45,000 together on their superannuation. They have worked hard to build that. They will lose their entire part pension of $11,400 per year. This government is going to take one dollar in every five. These are the real-world examples. I have more. There is Graham Ratcliffe, who gave us the details for a question. He says: 'Surely, you must agree there is something wrong with a system when a couple with $400,000 in assets invested at an average of three per cent per annum plus almost the full age pension will have an income of $43,766 but a couple with up to $800,000 in assets invested at the same three per cent plus a very small pension will only have an income of $24,566.'
It might be that each can live on that certain amount of money. But why is it that under this government they have created a binary situation? If you believe these fiscal bandits opposite—the enemies of the pensioner—what they say is that there are only two types of Australians. There are people who have very little money who get the age pension and people who have a bit more money and have a modest income stream and get the pension. In the Prime Minister's false binary that he loves to create of the goodies and the baddies, there are the really poor and then there are the modestly poor. But what he does not talk about is another group of Australians: Tony's multimillionaires. On superannuation they can—listen to this, Assistant Treasurer—use a cameo and distort and just lie about what I said. But that is what it is; we have little expectation of this person.
What we are proposing on superannuation is as straightforward as this—listen carefully, Josh; listen carefully, son—if you earn more than $75,000 a year, instead of getting a 45 per cent tax concession you only get a 30 per cent tax concession. What we are proposing is helping the budget bottom line over the next 10 years by $14 billion. I will give you another cameo in terms of who gets affected. There are 475 Australians with superannuation balances in excess of $10 million. That is a lot of money. Courtesy of this government, if they wanted to have a five per cent return, which is an average return on a superannuation fund, they get half a million dollars tax free. But they want to take the part pension from some of these other people and push them under or near $20,000 in total income per year.
This is a government who says there are only two sets of people: really poor pensioners and modestly poor pensioners. The government is inviting Australia and this parliament to choose between the two of them. We reject this false choice. Instead, we speak to the 700,000 people who are planning retirement in the next few years. There are people at work between the ages of 50 and 65 who will be 700,000 potential retirees who stand to lose the pension altogether. When this government casually says that we will have a war between the really poor pensioners and the modestly poor pensioners, it is not just 330,000 victims they are proposing. This government is coming after the pensions of people who have not yet retired. This is the consequence of the change.
We now have a generation of baby boomers who have been working hard and who are approaching retirement. They are doing the best they can to save superannuation, doing the best they can to try and prepare to have some asset in retirement. In the next 10 years this government is going to slug literally millions of Australians and affect their access to the pension. This government is vandalising the pension. The pension and the people who currently receive it are not on high annual incomes, they are not rich people and they deserve security in their old age. Yet the government will not go after the Costello-Howard loopholes whereby basically they said that any amount of money in superannuation can be tax-free. But they are going after pensioners on much more modest sets of incomes.
A person who has $½ million listed as their assets puts something aside for everyday emergencies. They have their car, they have their furniture. They might have $400,000 in term deposits. It sounds a lot to this mob opposite. Well, actually they know it is not a lot. But when you look at the annual income the person gets in the intersection with what they are doing with the pension changes, those opposite are wreaking great havoc on hundreds of thousands of people who were told at the last election that this would not happen. And as much as the government members may bow their heads and find something terribly interesting in the latest government press release, the latest contribution from George Brandis to anything—whatever they are reading—I would say this: we will fight for the pensioners.
Last year we stopped you with your pension cuts. Remember last year? For a year, this government bullied Labor. They harassed us. They said that the opposition was not telling the truth on the pension index. But we won. We stopped you cutting the pension, and we will fight you again. We will warn every part-pensioner in Australia: you cannot trust the Liberal government with your retirement.
We have clearly struck a chord: the Leader of the Opposition, who calls superannuation a legalised tax haven, insulting millions of Australians with 14 million superannuation accounts, $2 trillion of funds under management which grew from $300 billion in just 1997 and which will go to $9 trillion by 2040. The Leader of the Opposition is extremely sensitive today to the fact that we have read back to him the words of a doorstop he held less than two weeks ago. He was so impressed with his own words, and I am going to read them again. On 3 June the Leader of the Opposition held a doorstop. When asked by a journalist, 'What is Labor's policy on superannuation?', he said: 'If you've got $2 million in superannuation and you're in retirement and you're earning an income of $100,000, we are proposing you pay a reduction in the tax concession.'
Well, that is not Labor's policy, because I have their press release here from 22 April this year, where he actually said that Labor's policy is to put a tax on earnings above $75,000, not $100,000, and on balances above $1.5 million, not $2 million. The Leader of the Opposition has no standing in this place on superannuation, because he does not even know his own policy. He was thinking back to 2013, when he put out a press release with his best friend back then, the member for Lilley, saying that the tax on super that Labor proposed was on earnings above $100,000. Now we know that it was above $75,000. In its press release on 22 April this year, Labor had the audacity to say that it is only going to affect some 170,000 Australians. David Leyonhjelm had the Parliamentary Budget Office do the same sort of modelling for the same proposal, because the Labor Party would not release the modelling.
What did they find?
I am asked by the member for Bass a very telling question: what did they find? What did the Parliamentary Budget Office find? It found that Labor's proposals for two increases in taxes, on contributions and on earnings, would affect 425,000-plus people. Now, Labor has refused to index the threshold, which means that more and more people will go into those thresholds and more and more people will pay additional tax. The question is, why has Labor done this? Do they not like superannuation? Paul Keating did put the idea first on superannuation, and we supported him. But why has Labor done it? It is clear that Labor has done it in a desperate grab for cash to fill its budget black hole. Superannuation is the budget pinata: strap on the blindfold, grab a big stick and take a whack at people's hard-earned savings in super. It is the budget pinata, because you know that Labor's budget black hole is some $58.6 billion of measures that they are not supporting, including measures that the member for McMahon, sitting opposite, took to the last election as Labor's Treasurer and is now refusing to support in this parliament. Shame on Labor.
So, $58.6 billion is this budget black hole, which only grew when the Leader of the Opposition got up here on budget night and spent $220 million a minute. They have no way of balancing the books. In fact, the member for McMahon knows how to balance the books. While they were in government he put out a note to his electorate about the surplus they were to deliver. He was very proud of the budget surplus that would never eventuate. That is Labor's shortcut to surplus.
We have to do the hard yards. We have to do the long, hard yards to get to surplus, and we are doing that by prudent economic management. But what we will not do when it comes to superannuation is what Labor did: promise no changes and then introduce a whole lot of changes. We went to the last election saying we would make no adverse, unexpected changes to super in this term, and we will keep that commitment. Kevin Rudd went to the 2007 election and said he would not change superannuation one jot, one tittle. And what happened? There were 12 adverse changes, including to contributions, including to earnings, including to the self-managed super fund levy, going up under Labor, when we came up with self-managed super funds in 1999, under John Howard. And now one million Australians, like many of my colleagues know—members of their own electorate—put their hard-earned savings in their self-managed super funds. They are the people who were hit by Labor's additional taxes on superannuation. Those opposite were addicted to tax—wrongly, for the Australian people.
To digress, as Margaret Thatcher said, the problem with socialism—and you could say the problem with Labor—is that eventually you run out of other people's money. And that is the problem. They ran out of other people's money, and now they want to raid superannuation, even though the member for McMahon rushed out a press release in 2013 and said in the headline, 'We will make no changes for five years to superannuation'. That lasted all of 48 hours. Now we are in 2015 and the member for McMahon is supporting the member for Fraser, who is supporting the member for Watson, who is supporting the member for Maribyrnong—all increasing two taxes on super which, we know from the Parliamentary Budget Office, will hit at least 425,000 Australians.
That is a shameful record. But another problem that Labor has is pensions, with a sustainable retirement income, and the member for Jagajaga knows this all too well. As the member for Cook said in this place today, 'Superannuation is the hard-earned retirement savings of Australians and a pension is a welfare payment from one taxpayer to a pensioner.' And the more people save for super, the less they rely on the taxpayer for the pension.
The Prime Minister said today that we want to take people with $1 million-plus off the pension so that we can have a sustainable pension over the long term. The member for Jagajaga may not be aware that pension is the largest single budget item.
Ms Macklin interjecting—
The member for Jagajaga will get an opportunity.
If the member for Jagajaga would stop interrupting, she may like to know that the pension is the largest single budget item—some 10 per cent—more than $40 billion and growing at six per cent per annum. We in this place have said that we will ensure the pension is sustainable over time, reducing the burden on the taxpayer. How are we doing that? We are changing the taper rate and the assets-free threshold and are ensuring that some people who are currently getting a part pension will no longer get a part pension. But some people who are needy, some 50,000, who are getting the part pension will now get the full pension and 170,000 Australians who are on the pension will get an extra $30 a fortnight. Why is the Labor Party and the member for Jagajaga against low-income and low-asset-holding Australians getting an extra $30 a fortnight under us?
We have seen Labor's hopeless record on the pension and on superannuation—let me just add a third. That is the unclaimed moneys regime whereby Labor changed the years, from seven years to three years. Another desperate cash grab. And do not think that this does not hurt older, senior Australians. Because I will tell you a story, which was in The Daily Telegraph, of 82-year-old Maura Stanford, who went to her local bank to take out money from a 'rainy day' fund to pay a tradesman. When she went to get the money, it was not there. What had happened? Was it targeted by a scammer? No. It was targeted by the now Leader of the Opposition and the Labor Party.
The problem with the Labor Party is that they do not value, they do not understand and they do not trust Australians to save for their own retirement, to reduce pressure on the pension.
The final thing I want to mention is the reason why we are committed to superannuation, a sustainable pension and to saving people's money that is unclaimed is that we have an ageing population. We will have 40,000 centenarians in Australia over the next 40 years, compared to just 122 in 1974. The number of people over the age of 65 in Australia by 2055 will have doubled and the ratio of working Australians to retired Australians will go from 4.5 to 2.7. The coalition are better prepared to look after the senior citizens of Australia.
Australians should be very, very clear: Tony Abbott is coming after your pension. Whether you are a part pensioner living in the electorate of Banks, Braddon or Lindsay, each and every one of you now know that Tony Abbott is coming after your pension. If you are now on an age pension, if you are going to be on an age pension in the future, each and every one of you should know that this Liberal government and each and every one of these Liberal members of parliament are after your pension. That is exactly what they are doing.
People who are planning now for their retirement, people who are saving hard—all of them need to know that this Liberal government is after their retirement savings. That is exactly what each and every one of you opposite is doing. People who are now aged between 50 and 60, who are planning their retirement need to know that this Liberal government will make sure that their savings are attacked. That is what each of you opposite are doing and it is what all of you are going to be voting for.
Independent analysis in the last few weeks has shown that half of all new retirees will be impacted hard by these cuts to the pension. That is exactly what this is all about: these are cuts to the pension. All these hardworking Australians, who have saved for their retirement, will lose out if Tony Abbott gets his way.
All of us on this side of the parliament know—of course, you all try to block it out—that Tony Abbott said time and time again before the election that there would be no changes to pensions, no changes at all. Of course, as soon as he had the chance in last year's budget, he pushed through—and all of you voted for it—a cut to indexation of the pension of $80 a week. That is what you were prepared to take off pensioners. Of course, pensioners will never forget what you did, what you tried to do and they will never forget that each and every one of us campaigned for the last year to defeat that measure and we have defeated it. But of course pensioners know that, when Tony Abbott sees a pensioner, he cannot help himself.
Last budget he tried to cut indexation; this budget he has dreamt up a new way of cutting the pension. This year it will affect 330,000 part pensioners. Of course, you never hear them mention the people who are going to lose. You did not hear that from anybody in question time today, whether it be the minister, the Prime Minister or from the Assistant Treasurer just now. They do not want to mention the 330,000 part pensioners, who live in the electorates of Lindsay, Bass, Braddon and all those seats that are full of part pensioners, who are all going to lose. You go out there and tell those part pensioners that you are going to cut their retirement savings, because that is exactly what you are going to do. We also know that you have not forgotten about the other change that you announced last year: to make every single Australian work until they are 70. None of us has forgotten that, but all of you want to make sure that Australians have to work until we are 70. Shame on each and every one of you!
Pensioners have been calling and writing to us over the last few weeks since the budget, saying, 'We can only hope that Labor will do everything in their power to protect pensioners.' And we will. We will do exactly that. The Australian pensioners know that we are their friend and that we will support them—unlike all of those people opposite. What we also know is that the reality for part pensioners is going to mean a very, very substantial cut. I would be very keen to hear the nature of the exchange when you knock on a door in Penrith and tell a part pensioner that, as a result of this legislation, you want to take $8,000— (Time expired)
The proposition that has been put before the House this afternoon by the Labor Party is that there has apparently been a failure: firstly, to plan; secondly, for fair and sustainable retirement; and, thirdly, for all Australians. Labor is comprehensively wrong on all three of these points. First of all, we absolutely do have a plan. We have a plan designed to deal with the fact that the retirement income system—the age pension—costs $43 billion a year, and that cost is increasing. If it is to continue to be afforded, we need to have a plan to deal with it. We do have a plan on this side of the House—unlike this empty, weak rabble opposition that is consistently standing forward, standing up and engaging in cheap populist jibes. The former proud Labor Party has descended to this! None of you are descendants of Hawke and Keating. You are an embarrassment to the former proud Labor Party.
On this side of the House we have a clear plan to deal with a serious public policy issue: sustaining the provision of the age pension so it is always there for those who need it. Indeed, with the measures announced in this budget, those with no or few assets will see their pension rising, on average, by $30 a fortnight from 1 January. And yes, those with significant assets are facing an incremental tightening of the assets test. It is true that a couple with a house and assets of $1.15 million will now see a reduction in the assets test to $823,000. We recognise that this is an impost on a relatively small group of people, but this is about making sure that the overall system is sustainable, and we have a fair plan to do it.
Secondly, the issue before the House is whether the plan is fair and sustainable. With a $43 billion age pension system, we need that to be sustainable. We need to continue to be able to pay for the age pension system. We need to make sure that the pension will always be there for those who need it—the neediest, the vulnerable, those who get to the stage of life where they rely on the age pension and do not have other assets to rely upon. What could be a more cruel and irresponsible hoax from any major political party than to not ensure that the pension system is sustainable so that those who need it, when they get to their retirement age, have the pension system available to them? From the other side of the chamber, what do we hear from the once proud party of Hawke and Keating? What we hear is: 'Don't worry about there being deficit after deficit. We won't even turn our mind to it. We won't even worry about how things are to be afforded, because apparently that is the domain of a responsible political party. We are not going to worry about that.' That is essentially the argument that we are getting from this once proud, once economically responsible political party that is engaging in the cruel hoax of pretending that everything can be afforded, that there is no need to worry about it.
As serious advocates of policy know, we have in this country a welfare system where a key principle is that we target it to people who are in need, and that is an absolutely critical principle of the changes that we have announced in this budget. We are asked: how is this fair? Fairness is critical. It is critical that we encourage people to save for their retirement through the superannuation system so that they can build up the biggest possible balance and they can rely upon their own resources to the maximum extent possible. There is nothing fair about changing the rules on the taxation of super when people have been accruing savings throughout their working life. All of a sudden the Labor Party wants to increase the tax on superannuation so that if your income from superannuation is above $75,000 you are going to be facing new unexpected taxes. We reject that. It is not a fair approach.
The third principle is an approach for all Australians, and the right approach for all Australians is a retirement income system that meets the needs of all. For those who are in a position to save to provide for themselves and build up significant assets, the superannuation system is there for them to rely upon. For those without significant resources, we always need to have the pension system there. It would be a cruel hoax to pretend that we can continue to afford it without the responsible measures that we are introducing.
All day we have seen the contortions, the twists and the turns of this government as they justify their illogical position that the part pensioners of Australia have too much, but people with more than $1½ million in their superannuation account have too little. We have just seen a low point from the member for Bradfield, who says the superannuation or retirement income system should suit all. It should suit all—unless you have got less than $37,000 in income, and then we are going to take your tax concessions away from you, because they are not a priority for this government. You see the member for Bradfield railing against changes to taxation and superannuation—he came into the chamber and he voted to abolish the tax concessions if you dare to have less than $37,000 in your annual income, as every member opposite did. How dare they claim to be defenders of superannuation and tax when they have ripped off Australia's low income earners when it comes to their tax concessions!
They have no credibility and they have no right to claim to be the defenders of superannuation or tax. And they certainly have no right to claim to be friends of Australia's pensioners. They dare claim that they have a fair plan for retirement income. Well, they have exactly the opposite. They seem to think that it is just fine that 500 people with superannuation balances in excess of $10 million should pay zero tax on their earnings. If they earn more than $10 million, they can pay no tax yet those opposite are coming after Australia's part pensioners. Australia's part pensioners are going to come after them as well, I would suggest, particularly when they have heard this debate.
We have heard a lot from the Liberal and National parties today about what they really think. We have seen the Prime Minister, the Treasurer and the Minister for Social Services say that the pension is welfare. The pension is now welfare.
Mr Hutchinson interjecting—
We saw our old friend the member for Lyons interjecting during the debate saying Australia's part pensioners should draw down on their assets. Well send out a letter to your constituents and tell them that. Why do you not do a mail-out and tell them that? Tell them that is what you really think, that they should draw down on their assets. Our old friend, the member for Bradfield had an interesting announcement to make to Australia's pensioners that he is going to 'incrementally tighten' their benefits to the tune of $8,000 a year. That is some 'incremental tightening' from the government.
What those opposite really want to do is go after anybody with a low or middle income and leave alone anybody with a high income. The evidence has been very clear. We have seen the Murray report saying that the taxation superannuation concessions are not fit for purpose and should be dealt with. We saw the government's own Commission of Audit, which recommended a GP tax and $100,000 university degrees. Even the Commission of Audit said superannuation and tax concessions should be dealt with but this government will not do it because this government does not have the guts or the courage to take it on.
We see the government engaging in a scare campaign about superannuation. The Labor Party has the courage to say it is unfair and unsustainable to continue to see 38 per cent of Australia's tax concessions on superannuation go to the top 10 per cent of incomes while this government goes after Australia's part pensioners. We have seen this government launch a scare campaign. It is time for some facts. Under Labor's proposal, 94 per cent of people with superannuation balances in retirement would not affected by these changes. Ninety per cent of the revenue raised from our policy would be from the wealthiest superannuation funds with balances of more than $2 million. And the vast majority of balances affected will be in excess of $1½ million. In fact, 97 per cent of the revenue from our policy would be raised from the wealthiest superannuation funds with balances of more than $1.5 million.
And some more facts: this government said to Australia's low-income earners who dared earn less than $37,000, that they do not deserve a tax concession on your superannuation, that they will take it away. Not only did they say it but they did it. They trousered the tax concession for Australia's cleaners, they trousered the tax concession for Australia's low-income earners, they took it away from them, they abolished it and they got rid of it. They trousered it because that is what they want to do, because that is what their values tell them is okay. That is what they think is all right because at their heart they do not like people who dare to work hard and earn a low income. The Treasurer lectures people and says get a better job, get a job that raises more money and that is how you can buy a house. Well, that is what these Liberal and National values tell us and they are values that should be rejected. (Time expired)
I tell you what pensioners do know. Pensioners know that Australia can never afford to go back to what we saw under the previous Labor government. They know in their heart of hearts that we cannot go back to the waste and mismanagement of six years of Labor. After 2007, there was money in the bank, there were surpluses in front and what did they do? They trashed it. They left this incoming government with $123 billion of combined deficits peaking at $667 billion of debt if we did nothing. That is the story and Australian pensioners, who have saved for their retirement, very well know that.
Labor's record in government was that they took $9 billion out of superannuation. Remember what they said? Let's quote Kevin Rudd: 'Not one jot, not one tittle.' The member for McMahon said we will not touch it for five years. And then we had the Leader of the Opposition today say $2 million for those earning $100,000. But it was wrong. The policy is actually for those with assets of $1.5 million or who earn $75,000 a year. What Australians know is when it comes to superannuation, you cannot trust Labor. These people are the budget smugglers. The member for McMahon talked about the $37,000 threshold. Guess where that was coming from? That was the mining tax. Do you remember that one? How much did it raise? That was going to save us, if you remember.
I am a little bit confused after listening to the Leader of the Opposition's contribution this morning because Labor claim this ground on superannuation. It was them who invented it. But how is it that the taxpayers of Australia are willing to save for their retirement, concessions are paid on the way in and then those opposite say they should not spend it in their retirement. I just do not get it. You have got to rely entirely on your earnings and you cannot touch your capital. When I went to school, you could not take it with you. You cannot take it with you, the last time I looked.
Bill may well be into estate planning—I am not sure. But this is not about passing it on to the next generation. The concessions that you get when you are contributing to superannuation are designed to be spent in your retirement. That is how the whole system works. But government knows best on the other side. This is the Labor Party. They know much better how to spend other people's money. Well, we do not agree. We think that is a false premise. We believe that superannuation is not a piggybank for governments when they get into trouble—like when the previous government took $9 billion out of the savings of Australians.
Labor will tax your superannuation: make no mistake. And the record speaks for itself. Pensions are a safety net. I know it is difficult. Power prices are going up and water bills are going up. It is particularly difficult for those people in my electorate who are on the singles or couples pension. They are going to be better off, not only from the things we have delivered over the last 18 months. Singles are $56 better off a fortnight and couples are $78 better off a fortnight. The pension has already gone up. And guess what? We got rid of the carbon tax. That is worth $550 a year, on average, to every household in Australia. Under these reforms, the lowest earning pensioners, those with the least amounts of assets, will receive an extra $30 a fortnight. How on earth can I stand here and listen to the Labor Party be so hypocritical about their position on this?
We had a budget reply speech a couple of weeks ago. There is a $58.6 billion black hole. I like to refer to it as $220 a minute of unfunded commitments that were made by the Leader of the Opposition. Labor seems transfixed on part pensioners. They are a very small component of pensioners. If they draw down, the most those part pensioners will need to draw down on that capital is 1.9 per cent, to maintain that level of 1.9 per cent. A modest number of pensioners will be affected by that. You cannot trust Labor when it comes to your super.
To the pensioners of Australia, I say that there is a very simple way to tell if this Prime Minister is lying to you: his lips are moving. No more and no fewer than nine times in the last election campaign, the Prime Minister of Australia said to the pensioners of Australia, 'There will be no change to the pension.' Now we know, from day one, whether it is the former pensions minister or the current pensions minister, they have been working away behind the scenes to cut the pensions of Australians.
Were it not for the hard work of member for Jagajaga, for the hard work of my colleagues on this side of the House, that original cut to the pension would have gone through this place. We are proud that we stopped that first pension cut, and we pay tribute to the member for Jagajaga for that effort. That is the good news, that we stopped that. The bad news is that they are back.
They had a plan B.
They had a plan B in their drawer, as the member for Port Adelaide has just reminded us. What the pensioners of Australia need to understand is that all the members over there are voting for the following: a cut to almost 330,000 low-income pensioner households, and more than 90,000 pensioners off the pension entirely.
Government members interjecting—
All of them that are chirping up now are voting for that change. An independent analysis shows that these cuts will affect half of all new retirees within 20 years. In my community I have 11,803 pensioners who will be hit by these brutal cuts. One constituent, who contacts me frequently about the pension assets test, expects to lose $150 a week from his part pension. That is nearly $8,000 a year.
In question time we got a real sense of what those opposite really think about the pensioners of Australia. We got it from the Prime Minister and we got it from Minister Morrison. When the mask slipped, when cuddly Minister Morrison disappeared, we got from Morrison and from Abbott the same thing—that the pensioners of Australia are some kind of welfare bludgers. We got this sense that pensioners who worked all their life, retired workers, are somehow lying around as lazy bludgers in our community. We reject that characterisation. We reject this re-run of their lifters and leaners rhetoric that went so badly for them last time.
The Prime Minister and the Minister for Social Services describe Labor as the welfare party for standing up for pensioners in our community. We are the party who stand up for people who work all their lives. We are the party who stand up for people who put their kids through school and university, who paid their taxes, who deserve some dignity in retirement—the retirees and veterans in this community, the people who deserve our support in this place. They will get it from us. They will never ever get it from you.
On this side of the House, from the member for Jagajaga all the way down, every member understands one thing: if you attack the pensioners of Australia, you attack Middle Australia itself. We say to the government that if you are fair dinkum about improving the budget bottom line, if you are fair dinkum about making the retirement income system in this country better, then take the member for McMahon's advice—we have done the work for you. We have got a plan on superannuation; we have put it on the table, and we said 'take it'.
We could put it through tomorrow.
We could put it through this parliament tomorrow, as the member for McMahon says. If you are fair dinkum about fixing retirement incomes in this country then we have done the work for you. If you are not, if you want to keep defending a small number of people with a huge amount of super over the interests of 330,000 pensioners in Middle Australia, write to them all. Write to everyone in Australia. Write to the people in your electorates and tell them that your preference is to cut the pensions of 330,000 people, rather than fix the superannuation of a small amount of people.
We have got a very simple message for those opposite: get your hands out of the trouser pockets of the pensioners of this country; get your hands out of their handbags. Do not pocket the pension. Make sensible changes to the retirement income system in this country so that a small number of the wealthiest super accounts are fixed and so that we do not smash the retirement incomes of 330,000 good people, who have done the right thing their whole lives. They have paid their taxes, they have raised their kids, they have put them through school and uni—they deserve, and they will get from us, the respect and the dignity that they have earned in this community.
I am pleased to have the opportunity to speak on this matter of public importance. For those that are listening today by radio or online, and for the small number in the gallery, let us put a few fundamental pieces to this puzzle in place—very important pieces, I have to say. Do the people on the other side realise—I am sure that they do—that, as a result of their efforts, their 'fiscal efforts', if you could call them that, over seven years, we are now borrowing $100 million every day just to fill the gap between revenue and expenditure?
We will have a $36 billion deficit this year. We are paying $1 billion every month in interest. We have an ageing population. We are living longer. And those people opposite want to put their heads in the sand and make believe that there is nothing going on, nothing to be seen here; we need to do nothing; we can continue to do what we are doing.
I will tell you, Mr Deputy Speaker, that I heard an intervention over there earlier to the members for Bass and Lyons and me that asked: why don't we tell Tasmanians that? Well, actually we have. I give the people of Tasmania in our electorates more credit than those opposite give. I actually believe that, deep down, the people of my electorate—and I am sure in Bass and Lyons—understand the enormous task that we are facing.
We have two choices here. We can take the Leader of the Opposition and the Labor alternative government's plan, and that is to live by this philosophy that really we are in the business of estate planning and that hardworking taxpayers across Australia should fund into part pensions the inheritance of many. That is where we are heading: the idea that I should accumulate funds and live entirely off the interest and maybe a part pension and not even contemplate for one moment that I may have to draw down on my capital to see my days through. No. We are growing a culture in this country that suggests that the hardworking taxpayers should continue to contribute to my lifestyle to the day they put me in the box so that my kids can be rich. That is wrong. That is wrong, and it should be called what it is. It is not about estate planning. It is not about that at all.
In 1971—
Mrs Elliot interjecting—
Mr Conroy interjecting—
Just listen; you might learn something. In 1971, when I was 11, if I walked down the main street of my town, I would meet seven people aged between 15 and 64 before I met a person aged over 65. Today, I will meet fewer than five people who are aged between 15 and 64 before I meet someone aged over 65. It might be interesting to note that, in not too many decades, I could walk down that same street and I will meet fewer than three people who are aged between 15 and 64 before I meet someone aged 65.
Now, I have another term for people aged between 15 and 64. In my upbringing, I think we call them workers—taxpayers. I will just put the sums in place for those opposite. The reality here is that right now—for those listening to this and watching today—eight out of every 10 individual taxpayers in this country are stepping up for the welfare bill in this country. Eight out of every 10 individual taxpayers in this country are paying the welfare bill.
If you think that that can go on, well, knock yourself out. You take that vision, that plan, to the Australian people. I will tell you what has happened in the last 10 hours or so. As of yesterday, The Australian reported from very good sources that the Greens and the Australian Labor Party were going to support this. They woke up. They woke up this morning; Bill went out in his pyjamas, picked up his Australian, and there was the Newspoll: Mr Twenty-Eight Per Cent. That is what this is about. It is another diversion, and it is all about him. (Time expired)
I too am pleased to rise and speak on the government's failure to plan for a fair and sustainable retirement for all Australians, because we constantly see bad decisions from a bad government. That is all we ever hear from them. Labor will fight the Abbott government's second attempt to cut the pension for hundreds of thousands of pensioners.
The fact is that this Liberal-National government continues to recklessly attack the standard of living of older Australians. It does that by cutting their pensions, by slashing their services and by increasing taxes. The fact is that this government has failed the present and the future retirees of Australia as well. But those pensioners and older working Australians should be very clear about one thing, and that is that the Liberal and National parties are coming after your pensions. That is a fact. For those living in regional and rural Australia, it is the National Party that are coming after your pensions. That is my very clear message today; make no mistake about it. To all those people living in country Australia: the National Party are coming after your pensions. I note that there are none of them in the chamber right now. No wonder. It is absolutely terrible that they are voting for this measure. It will impact people in regional areas quite severely.
As we know, the government tried to cut pensions last year, and they are trying to cut them again this year. If they get re-elected, they will keep trying to cut them. That is what they do. The fact is that they just cannot be trusted when it comes to pensions. These unfair and cruel cuts that the government have been making have indeed been devastating to the nation and devastating to older Australians, particularly those older Australians who live in regional areas, such as those in my electorate of Richmond.
Locals in my area have every right to feel betrayed by this government and particularly betrayed, as I have said, by the National Party. This government really only has two things at its core: broken promises and unfairness. That is it: broken promises and unfairness. We see it time and time again. Of course, in its first budget, the government launched an unprecedented attack on the pension, particularly with its cuts to the indexation for pensions. It was one of the most savage attacks that we have ever seen. It would have seen every single pensioner in this country left worse off. Within 10 years, the cut would have amounted to $80 per week. In my electorate, there are 20,520 people on the age pension who would have had their pension cut by this cruel Liberal-National government.
Of course, before the election, we had the now Prime Minister promising that there would be no change to pensions. He said, 'No changes, no cuts.' He said on SBS News:
No cuts to education, no cuts to health, no change to pensions, no change to the GST and no cuts to the ABC or SBS.
In my area, we had all the National Party running around. They were all campaigning there on the North Coast of New South Wales. What were they telling everybody? 'No cuts to pensions.' And what did they do? We all know that the Prime Minister's promise, the Liberal Party's promise and the National Party's promise stand for nothing, and we know they cannot be trusted. Make no mistake about it: they will do it again. They will lie again. They will run around and tell everybody the same thing again.
But, in relation to those cruel cuts from last year's budget, pensioners made their voices heard. We in the Labor Party proudly stood with them to fight this government in terms of those cuts. We stood with them and we won in terms of those changes because we made it very clear that these were cruel and unfair changes. But then we get to this year's budget and what did they do? They continued their very unfair attack on pensioners. Labor will vote against the government's new round of cuts to the pensions. We will vote against this government's cuts to the almost 330,000 low-income pensioner households and the government's plans to throw more than 90,000 pensioners off the pension entirely.
These threats to pensions continue because the Prime Minister and his colleagues on that side of the House are out of touch. They just do not understand. They just do not get it, so they keep these attacks up on our pensioners. If you are on a pension now, be careful because the Liberals and the Nationals are coming after you.
With these changes, some single pensioners will be $8,000 worth off because of this measure. Some couple pensioners will be $14,000 worse off. More than 230,000 pensioners will on average be $130 a fortnight worse off—that is $3,380 per year. As I said, more than 90,000 pensioners will lose their pension altogether. So these are some very extreme cuts that will really impact right across the country.
In my area, I have been approached by so many pensioners very concerned as to how these cuts to their pensions will impact them. Make no mistake about it, Labor will fight this measure. As we fought it in last year's budget, we will fight it in this year's budget. We will stand with the pensioners once again and we will fight this right up until the election.
This government have lied consistently to the people of Australia. They said there will be no changes to pensions, but they have made changes to the pensions in last year's budget and in this year's budget. I say to people in rural and regional Australia, you cannot trust the National Party, particularly when it comes to your pensions. Many of our pensioners live in rural and regional Australia. We will keep fighting the government. We will fight them every day until the next election. Make no mistake about it, they lied before the election, they lied in relation to last year's budget and they will lie again.
Be careful using those terms. In this debate, you have to be careful how you use that term, please.
Mr Conroy interjecting—
Member for Charlton, you are not in your seat.
It was still a factual statement.
If you want to stay in the chamber, you will treat the chair with a bit more respect than that, member for Charlton.
I do not think we have seen so much confected outrage on the other side of the chamber for quite some time. The member for McMahon was yelling and screaming with such hysteria and getting so read in the face, I had to tune in my television set because I thought there was something wrong with the reception. Honestly, what we are seeing from the opposition is the utmost in hypocrisy. They have utterly lost their way. The fact that the Labor Party have just reversed its position after earlier deciding it would vote for these measures, and will now not vote for these measures, just shows what a mess the Labor Party are in. If you want to know about integrity, if you want to know about trust, turn onto the ABC tonight and watch The Killing Season and you will understand with greater depth and clarity why the Australian people rejected the Labor Party.
The government are proposing changes to the age pension which are measured, responsible and fair. These changes will see more than 170,000 pensioners with modest assets have their pensions increased by just over $30 a fortnight—that is an increase. The Labor Party will block an increase for pensioners who most need the government's help. And around 50,000 part-pensioners will now qualify for a full pension under the new rules. More than 90 per cent of Australia's age pensioners and others who receive pension-linked payments will either be better off or have no change to their arrangements under these new proposals.
Some members opposite know deep in their hearts that these are reforms that should be supported by the Labor Party. These changes are about looking after those who most need our help with compassion, equity and fairness—a fundamental obligation of government. But this is not the party of old. In opposing our changes, Labor are showing Australians that it has lost its way. As we heard earlier in the debate, Labor are making the Greens look utterly responsible in relation to these measures. Labor would rather look after millionaire part-pensioners than the most needy in our society.
Who are we talking about? Couples who own their own home with additional assets of less than $451,000 will get a higher pension. Couples who do not own their own home but have assets of up to $699,000 will also, under our measures, be better off. So it is incredible that Labor are opting to look after the part-pensioners with assets of well over $1 million and yet deny pensioners who most need our help with this pension increase. The member for Rankin has called these part-pensioners low-income earners. Why are Labor forgetting those who most need our help? With these measures, we are helping those who most need our help.
I want to reflect on what our government has delivered since we were elected. Since the election, the single pension is up by $52 a fortnight and the couple pension has increased by $78 a fortnight. We have abolished the carbon tax—a noose around the neck of every pensioner, imposed by the Labor Party—a saving for every household of on average $550 each year. Importantly, pensioners have kept the carbon tax compensation, which is $14 per fortnight for singles and $21.20 for couples. What we are seeing is a Labor Party which are very good at imposing taxes on Australians. Our government are focused on helping everyday Australians get ahead and save for their retirement. What we are seeing from members opposite, whenever they run out of money, is a planned raid on the superannuation accounts of Australians to fill Labor's black hole, a black hole created by their reckless spending.
I was delighted to host the foreign minister in Grovedale last week for a community morning tea. I can assure you, Deputy Speaker, we were talking about our government's focus on national security, on economic security, on job creation, on a fairer pension and on protecting superannuation. I can tell members opposite that people in my electorate are genuinely concerned about Labor's plans to raid their superannuation accounts. We will make sure that the accounts of Australians are protected and we will work very hard to look after those who most need our help.
The time for this debate has expired.
The Speaker has received advice that Mr Hayes has resigned as a member of the Council of the National Library of Australia.
by leave—I move:
That, in accordance with the provisions of the National Library Act 1960, this House elects Mr Ferguson to be a member of the Council of the National Library of Australia and to continue as a member for a period of 3 years from this day.
Question agreed to.
I rise to speak on the Excise Tariff Amendment (Ethanol and Biodiesel) Bill 2015 and the Energy Grants and Other Legislation Amendment (Ethanol and Biodiesel) Bill 2015. The first of these bills will reduce the rates of excise for domestically manufactured biodiesel and ethanol to zero for a single year, and that starts next month. Excise rates on these fuels will then rise each year incrementally up until 1 July 2020. At that point the excise rate for ethanol will be about 33 per cent, or one-third, of the rate for petrol. Similarly, at that point the rate for biodiesel will be about half the rate for normal diesel.
At the same time these bills remove grants for biodiesel and renewable fuels such as ethanol. Firstly, I want to make an important point about ethanol as a fuel and how the government treats it. There are people who believe that rebates are some form of welfare. Well I do not. I do not believe an ethanol rebate is giving away free money. A rebate is about treating ethanol as a different type of fuel and taxing it differently. When the ethanol rebate was first introduced it was not to come up for review until 2021, because the government recognised that it would take the industry that length of time to become established. We have gone and had a look at it. While the changes we have made get rid of the rebate I believe they also provide a level of certainty for the industry. They provide a clear excise regime extending into the future.
It was always envisaged, even when the Howard government brought in the rebate model, that 12½c a litre would be the excise rate that would eventually apply to ethanol. We have got that pathway to the 12½c a litre excise rate. I know from discussions I have had with people in the biofuels sector, particularly the Biofuels Association of Australia and other players, such as Dick Honan with Manildra, that they are very comfortable with this path forward because it does provide certainty and surety and their product is taxed at a lower rate than petrol.
It is true to say that there is only a small ethanol industry at the moment. With the industry as it is right now we are not seeing the benefits flow through to farmers, particularly cane farmers when the ethanol is produced from sugar cane. We could see that happen as a result of the framework in this legislation setting out a long-term sustainable plan for the industry but it would have to be accompanied by measures that the state governments pick up and run with.
The Nationals, the party which I am a member of in this parliament, have called for a 10 per cent mandate to be rolled out nationally this year, 2015, with the rollout of E20 fuels for consideration by 2020. They are ambitious targets. We are in the middle of 2015 and we do not have a nationwide mandate. That would have to be picked up by state governments. Slowly that is happening. New South Wales and Queensland are talking about it. We need to show leadership on this issue.
I question the wisdom and the values of some who were against ethanol and put forward the idea of immediately substantially raising the taxation levels on this Australian industry and increasing the cost of living by pushing up the price of the cheapest fuel alternative currently on offer at thousands of service stations. This bill does not do that, but there were pundits saying we should get rid of the subsidies and tax it at the same price as other fuel.
As the minister pointed out in his second reading speech, these changes were very much needed to get the budget back into surplus. We have to acknowledge that Labor and the Greens left the budget in a parlous state and that action is necessary in reducing government expenditure. I feel for the Greens and their current dilemma on this issue—
I'm going to use those words against you.
That is probably the first and only time that I will use those words, member for Moreton. This is a clean fuel. I feel for them with the dilemma they have imposed on this. As willing partners in the waste of the Rudd-Gillard-Rudd years I suppose they are partly responsible for this change. The change is not bad but it would have been better to actually see the zero excise regime rolled out until 2021.
I am very happy to talk about the ethanol industry, because I represent the largest sugar-growing electorate in the country—it includes the Mackay region, Proserpine and the Burdekin region—and I have long supported an ethanol mandate in this country. In particular, I think that it should be compulsory for North Queensland servos to have this product at the bowsers. There is no point in beating around the bush on this issue, because a half-hearted approach is not going to achieve anything. A proper ethanol mandate in Queensland would ensure the viability of, say, Sarina's ethanol plant, in the area that the member for Capricornia so ably represents, and it also may pave the way for future investment in ethanol production by groups like Mackay Sugar, which the member for Capricornia, by virtue of the Electoral Commission, represents as well.
In the Burdekin, in my electorate, Austcane Pty Ltd has been working on something for a long time. It has a substantial amount of work done on the establishment of a mill that would only produce ethanol. That would provide jobs, needless to say, but it would also give cane farmers in that area a supply option other than the existing mill monopoly that is controlled by Singaporean milling company Wilmar. I would like to see the state government bring in a phased-in mandate where the government would require fuel retailers to have a certain percentage of ethanol in their overall fuel mix and have that percentage ramping up over time. We do not want to see them rush to 10 per cent straightaway, because if they just went from zero to 10 then all it would result in is imported ethanol and no domestic production occurring, because the time frame to get some of these production lines started up is simply too long. If the plan the state government currently have is simply to require service stations to have a single bowser selling E10 as an option, it is going to be a missed opportunity. That sort of approach would see those E10 bowsers tucked down the back as an afterthought, because the reality, as we all know, is that the oil companies make less money out of an E10 blend.
A proper mandate for ethanol in Queensland would be advantageous for a number of reasons. Ethanol is a renewable resource and it is proven to have a lower particulate matter output, which is why groups like the Asthma and Allergy Foundation of America support the use of ethanol fuels. Secondly, for motorists feeling the pinch of high fuel prices, an ethanol blend is actually a cheaper fuel by virtue of this excise regime. Thirdly, we have a problem in this country with fuel security, and the more we look at domestic production of fuel sources the better off we are.
This issue was highlighted recently when terrorist group al-Qaeda urged followers to attack or sabotage the companies that supplied oil to countries like Australia. The terrorists targeted what they thought were choke points, and one of those was the Malacca Straits, through which half of Australia's oil imports are transported. In response, we saw some debate at the time about fuel security in this country. The former Deputy Chief of Air Force Air Vice Marshal John Blackburn warned in an ABC interview at the end of last year:
If there's an interruption to the fuel supply chain coming in from overseas, after about a week we're going to run into serious problems. Without fuel can't go to work, can't get to school, you can't get food.
He went on to say:
Sydney, for example, in one week alone there's about 45,000 truck trips just distributing food. You'd start to see the food run short in the shops probably in three to four days. You start to see the chemist run out of supplies after about three or four days and our services we take for granted; electricity supply, water supply, none of this can happen without fuel for the supporting elements for those functions. So you'd start to see society collapse.
I do not want to paint too bleak a picture of the potential risk here, because there are some safeguards in place. For instance, Australia sources its fuel from many different countries and it is transported through many different shipping routes. But we should be building more domestic self-reliance into the system. We should be embracing biofuels like ethanol for the many advantages they bring, instead of being like the people that are out there looking for ways to tear the industry down or, worse, manufacture reasons to attack the industry.
Unfortunately, some of these people are within the bureaucracy of this government. I single out the Bureau of Resources and Energy Economics, because they have been known for their anti-ethanol stance. They came out with a report saying that the so-called subsidies to the ethanol industry should be completely scrapped and we should ramp it up to the fuel excise. I was at the time, and I still remain, fiercely opposed to the recommendations that came out in that report. The report was wrong. It understated the employment that had been generated by the ethanol industry, and it was talking about how ethanol excise was being forgone to the tune of 38c a litre, forgetting the fact that both sides of the political spectrum had only ever said, once this whole idea of ethanol rebates was begun, that ethanol would be, at the very most, taxed at 12½ cents a litre. If those Canberra bureaucrats had had their way, Austcane's proposed ethanol mill in the Burdekin would probably never see the light of day and I would have had very grave fears for the future viability of the Sarina ethanol distillery. Just to highlight the tenuous nature of the industry, the Sarina distillery was affected by weather one year and could not make its supply contract, and customers pulled the pin on ethanol as a result.
We have to consider that Australia does not operate in a vacuum, and it is interesting to consider how our market also fits into the global ethanol industry. Brazil leads the world in development of ethanol. From 1975 to 2000, sugar cane yield per hectare in Brazil increased 33 per cent, cane sugar content rose eight per cent, ethanol yield from sugar rose 14 per cent, and fermentation yields rose 150 per cent. The US now leads the world in ethanol production and, combined with its advances in gas, it is becoming increasingly self-sufficient in fuel. Australian sugar cane produces a higher sugar yield than Brazil, and sugar produces a far greater ethanol yield than corn, which is what is used in the US for the production of ethanol. Why are we not taking better advantage of these factors?
The global sugar market is volatile at the best of times. We are talking very soon in this country about developing the North. There is going to be a white paper announced, sugar cane being one of the easiest products to grow in that neck of the woods. We need to grow better markets that are stable. A 10 per cent ethanol mandate in the state of Queensland would provide that stability. If a 10 per cent mandate were implemented, not just in that state but right across this nation, it would take more than half our current sugar cane crop to produce. Traditionally, farmers are only paid for the sugar produced from their cane. Proprietary mills mostly do not pay for the by-products of the sugar-making process like bagasse, molasses and ethanol. But dedicated ethanol mills such as the one proposed by Austcane convert directly to ethanol. More options would give cane farmers some bargaining power when it comes to selling their product.
At the moment, there is really only one option, so cane farmers are price takers, not price makers. I would love to see a situation where a mill producing only ethanol rolled out so that our farmers could get a better and more secure and stable form of income in that neck of the woods. It is a little disappointing there is not greater national interest in the use of ethanol as a fuel, especially given the climate scare that we are constantly hearing about and that is perpetuated by the green movement. Ethanol as a fuel is greenhouse neutral, because carbon dioxide produced when the fuel is burnt is reabsorbed as the crop grows. Ethanol plants can be powered by the crop itself, using co-generation, which is already being used by a mill in Mackay. Burning ethanol instead of fossil fuels reduces emissions of carbon monoxide, hydrocarbons, 1,3-butadiene, benzene, toluene, and xylenes. Reducing these emissions would see a reduction in chronic diseases like asthma, bronchitis and uvulitis. We need to expand this industry. (Time expired)
I rise to speak in this debate on legislation that implements the government's 2014-15 budget measures to change the taxation treatment of fuel ethanol and biodiesel: the Excise Tariff Amendment (Ethanol and Biodiesel) Bill 2015 and the Energy Grants and Other Legislation Amendment (Ethanol and Biodiesel) Bill 2015.
The Australian government transport fuels policy settings are designed to be fuel and technology neutral. That is because the government believes that an open and competitive market is the most effective means to deliver the widest possible range of fuels. The budget measures remove existing grant schemes and in their place provide that the domestic production of biodiesel and fuel ethanol will be subject to a reduced but gradually increasing rate of excise.
The energy white paper released on 8 April 2015 outlines the government's priorities to increase competition and national energy production and secure investment in the energy sector. It reiterates government policy that will ensure a technology-neutral policy and regulatory framework. As part of this, the energy white paper indicates that the government's preference is for the alternative transport fuels sector to be strengthened by being successfully integrated into the broader fuels market on a commercial basis. When I say 'the alternative transport fuels sector', that includes liquid petroleum gas, compressed natural gas and biofuels, including ethanol and biodiesel. Successful commercial integration means that government policy does not preference one fuel or technology over another. This policy brings biofuels into the same excise framework as other alternative fuels and will provide long-term certainty for investors in the industry.
Along with technology neutrality, the government's energy white paper that was released in April this year also advocated the creation of efficient markets. Efficient energy markets give consumers choice in how they source and use their energy and enable suppliers to respond to those choices. The government aims to avoid unnecessary regulatory barriers and subsidies that distort energy markets, shield competition and dilute price signals. This legislation aims to get the right balance in the market to maintain our investment attractiveness and our ability to adopt new technologies.
Australia's biofuel industry is only a small part of the overall fuel industry. It includes ethanol and biodiesel as well as a small experimental advanced biofuel research sector. Biofuels comprise 0.8 per cent of the total Australian transport fuel mix. But the emergent biofuels industry is growing and can also lead to economic opportunities for others in the economy. These opportunities include providing farmers with alternative sources of income through a local market for lower grade products as feedstock for the biofuels industry.
I would now like to speak about a couple of the larger elements in the alternative fuels industry. Australia's three ethanol plants produced approximately 236 million litres of ethanol in 2013-14. One of these plants is in Nowra, on the New South Wales coast. This is Australia's largest ethanol producer, converting wheat flour into protein and carbohydrate, with ethanol produced as a by-product of the carbohydrate production. Australia has two other ethanol plants, both in Queensland—one in Dalby, processing red sorghum, and the other at Sarina, processing molasses produced as a by-product of sugar refining.
Australia has seven biodiesel plants, in Victoria, South Australia, Western Australia and Queensland. They operate on feedstocks that include tallow, recycled cooking oil and other oils. In 2013-14 Australian plants produced 71 million litres of biodiesel. In 2014 the Bureau of Resources and Energy Economics estimated that the Australian ethanol industry created 160 to 200 direct jobs. A report prepared by Deloitte Access Economics for the Biofuels Association of Australia report released in February 2014 found that the biodiesel industry leveraged 438 full-time equivalent jobs.
The government support to the sector has been substantial and has extended for more than a decade. Since 2002 the biofuels industry has received support through programs like the Ethanol Production Grants program, the Energy Grants (Cleaner Fuels) Scheme and the Biofuels Capital Grants Program. The government will continue to provide long-term support to the biofuels industry and provide it with certainty for the future by bringing it into the excise system.
This proposed legislation delivers that certainty by proposing domestically produced ethanol and biodiesel will be brought into the excise system by applying excise on an energy content basis. The proposed changes recognise the fuel diversity and environmental and regional development benefits that the biofuels industry provides, through a 50 per cent discount on the energy based excise for each biofuel category. In doing this, the government will bring the biofuels sector into line with other alternative transport fuels like liquefied petroleum gas, liquefied natural gas and compressed natural gas, which have all transitioned into the excise system.
I would like to take a couple of minutes to look specifically at the detail of the legislation. The Energy Grants and Other Legislation Amendment (Ethanol and Biodiesel) Bill 2015 repeals the Energy Grants (Cleaner Fuels) Scheme Act 2004 and makes the appropriate consequential amendments. The cleaner fuels grant scheme used to provide a full rebate for excise paid on biodiesel.
The second piece of legislation is the Excise Tariff Amendment (Ethanol and Biodiesel) Bill 2015, which amends the Excise Tariff Act 1921. These amendments will reduce the rates of excise for domestically manufactured fuel, ethanol and biodiesel to nil for a one-year period, commencing on 1 July 2015. The bill then sets out a five-year excise pathway for fuel ethanol, so that it increases each year from 1 July 2016 until 1 July 2020. On 1 July 2020, the excise rate for ethanol will settle at approximately 33 per cent of the excise rate for petrol. This is in line with the alternative fuels excise framework, which applies excise based on the energy content of a particular fuel. This is in line with the alternative fuels excise framework that applies excise based on the energy content of a particular fuel. The bill also sets out a 15-year excise pathway for biodiesel from 1 July 2016 until 1 July 2030. The excise rate for biodiesel will increase at the same rate as ethanol for the first five years, and then it will increase year on year from 2026 to 2030 so that it settles at an excise rate equivalent to 50 per cent of the excise rate for diesel.
We have provided a longer transition period for biodiesel to ensure the industry's viability. The government has listened to the industry's concerns on transitioning into the excise system. The domestic industry has indicated that it needs around 15 years to adjust to the government's alternative fuels excise framework. A shorter transition would most likely lead to long periods of negative cash flow for an otherwise sustainable industry. However, the ethanol industry has indicated it can adjust over a shorter period, so the phasing-in period has been set at five years.
In conclusion, these two bills provide a responsible pathway to a sustainable excise rate for biofuels. They provide certainty for two additional sources of energy in Australia—two fuels that are making valuable contributions to Australia's fuel mix and that are sourced from renewable biomass. It is no longer appropriate that the biofuel sector be seen as a special case, requiring propping up by finite government assistance. However, I want to reiterate that these changes are measured and appropriate and take full account of the relevant issues and of the views and the needs of the relevant industry interests. I commend this bill to the House.
Question agreed to.
Bill read a second time.
I present a supplementary explanatory memorandum to the bill and I move the government amendment as circulated:
(1) Schedule 1, item 4, pages 4 and 5 (table items 2 to 6), omit the table items, substitute:
First I would like to thank those members who have contributed to this debate. These bills implement the government's 2014-15 budget measures to reform the taxation treatment of biodiesel and ethanol. The measures have been amended to allow for an additional transitional period for biodiesel producers, to give that sector longer to adapt to these excise changes. These changes to the taxation of biodiesel and ethanol will continue to provide support to these Australian industries while keeping the budget position on track.
These bills also abolish the cleaner fuels grants scheme, which refunds excise and excise equivalent customs duty paid on both imported and domestically produced biodiesel. In addition, the ethanol production grants scheme, which refunds excise paid on ethanol to domestic producers will cease on 30 June 2015. These changes reflect the important role that domestic ethanol and biodiesel producers play in the Australian economy and encourage diversity in Australia's fuel mix.
The budget measures are estimated to save the government $257 million over the current forward estimates period, and the new biodiesel transition is estimated to have a small cost to the budget of $6.5 million over the forward estimates period. I commend these bills to the House.
Question agreed to.
Bill, as amended, agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
Labor supports the passage of the Customs Amendment (Australian Trusted Trader Programme) Bill 2015. This bill essentially establishes a quality assurance framework for trading entities that operate within the customs framework within Australia. It provides the legislative framework for the establishment of the Trusted Trader Program from 1 July 2015. In June 2005, the World Customs Organization established standards to secure and facilitate global trade, which are known as the WCO SAFE Framework. The SAFE Framework introduced standards that promote supply chain security and trade facilitation at a global level to allow certainty and predictability of trade moving across international borders. The creation of the SAFE Framework was described by the WCO as 'a historic occasion upon which implementation would act as a deterrent to international terrorism, secure revenue collections and promote trade facilitation worldwide'.
The concept of a Trusted Trader Program, or a security and quality assurance framework, has been adopted by all of Australia's major trading partners—including the United States, Canada, New Zealand, Japan, China and the European Union—over the last 10 years. Essentially what we are doing here today is ensuring that our customs framework complements and works in conjunction with other supply chain frameworks throughout the world—in particular, those of our closest trading partners. It is through the WCO SAFE Framework that the promotion of standards that enable a harmonised and integrated approach to supply chain management for all participants is sought. Consistent with the WCO SAFE Framework, the Australian Trusted Trader Program will introduce a differentiated trust based regulatory framework at the border for those entities that meet or exceed international supply chain security and trade compliance standards. Entities meeting those standards will be assessed as 'low risk' and will benefit from reduced regulatory burden and streamlined customs processes. This will alleviate a significant trade burden and enhance the competitiveness of Australia's international businesses.
The previous Labor government, under the former Minister for Home Affairs Jason Clare, released in July 2013 the Australian Customs and Border Protection Service Blueprint for reform 2013-2018. It was in that document that the notion of the Trusted Trader Program was first highlighted. The blueprint said:
Recognising our role supporting economic prosperity and protecting the community, we also support the World Customs Organisation's framework of standards. This framework focuses on cooperation and collaboration between customs administrations and industry in managing the whole-of-trade supply chain.
While the Australian Trusted Trader Program is a trade facilitation initiative based on internationally recognised supply chain security and compliance standards, it contributes to a holistic compliance framework as an important element of the compliance continuum. That provides a better understanding of the entities moving goods across our borders. This strategy will basically work to 'shrink the haystack' by removing trusted entities from traditional transaction based border risk assessment. But I must point out that border risk assessment predominantly relates to administrative processes around the priority of assessment for tariff rulings, the return of customs duties and the like; it does not affect the tests that are ordinarily applied by agencies such as the Australian Federal Police or biosecurity and security tests of any imports coming into Australia.
The program and the agreements that entities within the industry will sign up to have been developed in consultation with industry. In August 2014, Customs established an industry advisory group to provide advice, feedback and input into the design and development of the Trusted Trader Program. Industry groups such as the Australian Federation of Freight Forwarders, the Australian Industry Group and the Australian Peak Shipping Association were involved in that peak body, as well as large firms such as Boeing, Fletcher International Exports, GM Holden Ltd, HP Australia, IBM, Ikea and Qantas. So the approach that is being taken in this bill has the support of industry in Australia who work in the customs framework.
The main amendments in this bill allow for the creation of Trusted Trader agreements. This allows an entity to nominate themselves to participate in the Australian Trusted Trader Program. That will allow the Comptroller-General of Customs to enter into a Trusted Trader agreement with an entity which will provide administrative benefits to that entity if the entity nominates itself to participate in the program and the Comptroller-General of Customs considers that the entity is reasonably likely to satisfy the qualifications set out in the rules, the qualification criteria.
It is at that point that the entity is given provisional agreement, and no privileges extend at that particular point. It is then up to the entity to prove that it meets the minimum qualifications for certification as a trusted trader. Once that has occurred—once those tests have been done and accreditation has been provided—that will then allow the Comptroller-General of Customs to vary the agreement to provide those additional administrative benefits and legislative benefits under part 4, other than division 1, and part 6, other than division 1, of the Customs Act, if he or she is satisfied, as to the validation of the qualifications criteria, that the entity satisfied the qualifications criteria set out in the rules, and to provide that agreements may be subject to conditions prescribed by the rules and terms and conditions specified in the agreement. That will then allow the Comptroller-General to vary, suspend or terminate an agreement unilaterally if he or she reasonably believes that the entity has not complied, or is not complying, with any condition prescribed by the rules or a term or condition specified in the agreement.
The program also allows a decision of the Comptroller-General of Customs to refuse to enter into a trusted trader agreement to be a decision that is subject to review by the Administrative Appeals Tribunal. The legislation also allows a decision of the Comptroller-General of Customs to refuse to vary a trusted trader agreement to be a decision subject to review by the AAT. The program also allows a unilateral decision of the Comptroller-General to vary, suspend or terminate a trusted trader agreement to be a decision that is subject to review. It also allows the Comptroller-General to maintain a public register containing information of a kind prescribed by the rules in relation to each trusted trader agreement entered into, and allows the Comptroller-General of Customs to prescribe rules, by legislative instrument, for and in relation to the operation of the program.
In terms of the qualification that an entity must meet to be considered for, or to be certified under, the trusted trader agreement, those qualification criteria will be included in the program rules, and the rules will be a legislative instrument, which will be subject to parliamentary scrutiny and disallowance. The qualification criteria have been developed having regard to international best practice. The criteria set out in annex III of the World Customs Organization SAFE Framework of Standards to Secure and Facilitate Global Trade and the WTO Agreement on Trade Facilitation are all covered by the proposed rules associated with this program. The qualification criteria to be set out in the rules will require that an entity undertakes activities that form part of the international supply chain; has been operating in the international supply chain for a minimum of two years before submitting their nomination; and is a lawful or legally standing association, corporation, partnership, proprietorship, trust or sole trader that has the legal capacity to enter into agreements or contracts, assume obligations, incur and pay debts, prosecute and be prosecuted in its own right and be accountable for illegal activities. The entity must also have an Australian Business Number, and have completed a security risk assessment that is periodically reviewed by the entity and identifies risks specific to their international supply chain activities and identifies measures that the Comptroller-General of Customs considers are adequate to mitigate those risks in respect of integrity.
The entity must also meet the following requirements relating to criminal history of the principal owners or directors of the entity, or any other person within the entity that is critical to the integrity of the international supply chain. The entity must meet certain financial viability requirements and the entity must be able to meet its financial obligations when they fall due. The entity's record-keeping system is scrutinised and the entity must keep records that contain meaningful and useful information demonstrating compliance with Customs-related laws and records must be secured from misuse and unauthorised access. Also, as to the accuracy and timeliness of communications regarding the importation or exportation of goods, the entity must demonstrate that they have adequate procedures in place to ensure that the communications made regarding the import or export of goods are accurate and secure and submitted in accordance with relevant statutory time frames. The entity must also prove supply chain security standards—namely, that the entity has, having regard to the entity's role in the international supply chain, adequate security measures relating to logistical procedures for security, physical security, cargo unit security, personnel security, third party and business partner security—and, finally, that the entity has trade compliance standards as to the entity's compliance with a Customs-related law as defined in section 4B of the Customs Act.
The Trusted Trader Program initially will be piloted by Customs and Border Protection, and the Trusted Trader Program will exist in a pilot phase for the first 12 months of its operation. It is expected that 40 companies who work in this space will be involved in that pilot. There are benefits that will flow to an organisation during the pilot phase, once they have met the initial compliance standards and have been granted trusted trader status by the Comptroller-General and they have had their agreement varied. Those benefits will flow to the particular entity once those processes have been fulfilled.
The processes are: enhanced client services through the provision of a departmental account manager; priority trade services, such as priority processing of advance rulings in relation to tariffs, origin and valuation advice, internal reviews of tariff advice and processing of refunds of Customs duty or a duty drawback; and reduced examinations which, as I mention earlier, are subject to security assessment and do not undermine processes that already take place in respect of the role of the Australian Federal Police and other security agencies.
On the whole, this is a reform that will ensure that Australia's Customs and supply chain government procedures align with world's best practice through the WCO SAFE Framework. It will align our practices to ensure that they are streamlined and will work in concert with the processes of our major trading partners. On that basis, Labor is happy to support this amendment to the Customs legislation.
Thank you, Mr Deputy Speaker, for this opportunity to speak on the Customs Amendment (Australian Trusted Trader Programme) Bill 2015. The member for Kingsford Smith has taken the House through the bill, which establishes a Trusted Trader Program from 1 July this year. This means that certain exporters and importers will be able to enter into a Trusted Trader Agreement with the Comptroller-General of Customs. This will give them special rights and privileges, including enhanced client service, priority trade services and reduced examinations—subject, of course, to risk assessment.
The goal of this program is to make it easier for Australian importers and exporters in low-risk industries to get access to international markets. I am very passionate about this and I am sure that both sides of the House are very passionate about it. This will alleviate significant trade burdens and enhance the competitiveness of Australian international businesses.
There has been a lot of discussion of trade in the media lately. Every day there are stories about the TPP, ChAFTA, KAFTA and JAEPA—an alphabet soup of trade agreements. This flurry of activity in trade has been brought about by necessity due to the changing fundamentals of the international economy. Increasingly, international production is characterised by the emergence of elaborate global value chains.
To take a well-worn example: the iPhone. You have the design, the software and the marketing done out of the US; you have the colour screen and the speakers, which use rare earth elements from Mongolia; you have the chips and batteries made in Korea and Taiwan; and you have other parts made in France and Italy, and then it is assembled in China. That does give a good example of how increasingly in the global economy you can have one device or one product with numerous companies and numerous nations involved in its production.
The McKinsey Global Institute has done a terrific job of quantifying these benefits of global value chains in their recent report, Global flows in a digital age. I commend that particular report to honourable members. It showed that the flow of goods, services and finance around the world in 2012 reached $26 trillion, which is 36 percent of global GDP—1½ times larger than in 1990, not that long ago.
The McKinsey Global Institute found that the flows themselves contribute a great deal to GDP growth, confirming what we as internationalists in this place know intuitively: that trade liberalisation has driven competition, innovation and entrepreneurship. The contribution of these flows to global GDP is as much as $450 billion each year—between 15 to 25 per cent of world economic growth. It is not just decades of liberalisation that have brought about this rise in global exchange; of course we have also had rapid technological advance and digitisation, which is increasingly transforming and supplementing all global flows.
While international trade is rapidly changing, Australia is at risk of falling behind if we are too slow to adapt to changes in the global economy. According to APEC, approximately 40 per cent of exports measured in value-add in Australia originate from services—more than double the representation of services in gross trade statistics. But this number is still below the OECD average of 48 per cent, despite Australia performing well in the OECD Services Trade Restrictiveness Index. Even worse, while New Zealand, the UK and the US outperform us in terms of value-added service exports, they have also increased their share since 1995. In Australia, our share of value-added service exports has actually fallen in that period.
Recent research from the UN Conference on Trade and Development reveals that Australia's participation rate in global value chains is lower than that of 22 of the 25 largest-exporting economies. This means that Australia is missing out on a lot of opportunities to value-add, as we trade increasingly in raw materials instead of using our human capital—our ideas and our imagination—to its greatest advantage.
A Lowy Institute report Global value chains, border management and Australian trade, released last year, found that Australia has huge potential benefits by increasing our engagement in those global value chains. They estimate that continued liberalisation of trade in services could result in an additional $21 billion in Australian services exports, and an extra 100,000 Australian jobs at a time when, as we all know, jobs are hard to come by. I want to congratulate the Lowy Institute on their report, but it also says:
… the window of opportunity for Australian service providers to entrench themselves in GVCs throughout Asia’s high-growth economies and beyond will not remain open forever.
This is a timely warning. Christopher Vas from Murdoch University argued in The Conversation in 2013 that Australia's strong trade with our regional neighbours—the big four of China, India, Japan and Korea, as well as Taiwan, Indonesia, Thailand and New Zealand—came down to our regional competitive advantage. In other words: proximity and resources. But he said that our privileged position:
… may soon come under pressure, with other international economies wanting to take advantage of the burgeoning Asian economies.
So for all of these reasons—with all of these pressures, with all of this change and with all of this opportunity swirling around us in the most dynamic part of the global economy—we will support the Australian Trusted Traders Program today, as my colleague the member for Kingsford Smith indicated in his contribution a moment ago.
It was my colleague, the member for Blaxland, when he was the minister for home affairs and justice, who made a first important key step in this direction, which really laid the foundations for this bill that we are supporting today. He released the Australian Customs and Border Protection Service Blueprint for Reform 2013-2018. In it the Labor government, of which he was a part, identified facilitating trusted trade as a key area of focus for reform of Australia's approach to trade and goods.
This bill allows the Comptroller-General of Customs to enter into a trusted trader agreement with entities to provide them with administrative benefits and advantages—and we are all for that. Exporters and importers wishing to enter into these agreements must be part of an international supply chain for at least two years, have an ABN, have completed a risk assessment, and need to have met robust supply chain security standards—in addition to other important conditions—to make sure that there is integrity in the system so that people are getting the right kind of advantage from being part of it. These trusted traders will get access to priority processing of advance rulings, enhanced client service and reduced examinations if they pass all of those conditions that I just ran through. This will make it easier for importers and exporters to do their job. It will make them more competitive globally and that is a great thing for every Australian. The more competitive our businesses are, the more successful they are in regional and global markets, the better it is for the Australian standard of living more generally.
We know, from the example provided by our friends across the ditch in New Zealand, that these sorts of schemes do work, as the Secure Exports Scheme from New Zealand has shown. Around 120 authorised exporters are part of the New Zealand scheme. In 2013, almost a third of all New Zealand exports originated from these authorised exporters, so you can see the potential in a well-run scheme of this nature. Data from New Zealand shows that despite the fact that Australia has an FTA with the US, New Zealand exporters with no such agreement are 3½ times less likely to see their cargo held up for examination on arrival at a US port.
Again, quoting the authority of the Lowy Institute report:
Australian exporters are left looking like Australian travellers waiting in line at Heathrow Airport, waving passports with Her Majesty's request that that they be offered every assistance, while EU passport holders walk straight through.
That is a colourful way of highlighting the challenges that we are up against here and why it is so important that the Australian Trusted Trader Program will remove some of these barriers for Australian companies.
There is, of course, more to be done in this area. Once the Trusted Trader Program is up and running, Australia will need to push hard to ensure that the scheme is recognised by our major trading partners. In other words, we need to ensure that the trust we place as Australians, as an Australian government, in our trusted traders is reciprocated by our trading partners. Again, I indicate that Labor will be supporting the Customs Amendment (Australian Trusted Trader Programme) Bill 2015. We took the first step in this direction when the member for Blaxland released the Australian Customs and Border Protection Service Blueprint for Reform.
There is a much broader principle at play here. This is an important piece of very specific legislation and we are all for it, but, more broadly, we need to commit ourselves, in this place, to ensuring that businesses of all sizes in this country—big, medium and small—are not left behind in the global economy. We are up for supporting anything which gets Australian businesses a bigger and better slice of the action in the global value chains of the future. Increasingly, we know that those global value chains will be operating in our region—the most dynamic part of the global economy.
We want to send a message from this place, from the House of Representatives, to every Australian business that what we can do to make life easier for you—to make you more wealthy and prosperous—we will do, because there is a flow on impact for every Australian in the jobs and the prosperity that good Australian businesses create, whether they are selling into the domestic market or into the global market beyond.
In summing up the debate, I thank all the members for participating in this debate. The Customs Amendment (Australian Trusted Trader Programme) Bill 2015 will amend the Customs Act 1901 to establish the Australian Trusted Trader Program. The program will introduce differentiated trust-based regulatory treatment at the border for those entities that meet or exceed international supply chain security and trade compliance standards. The Australian Trusted Trader Program—which has been co-designed with industry stakeholders, partner agencies and international counterparts—is a trade facilitation initiative based on internationally recognised supply chain security and trade compliance principles that contribute to a holistic compliance framework.
The proposed changes to the Customs Act will allow the Comptroller-General of Customs to enter into a trusted trade agreement with an entity that has nominated to participate in the program. A decision of the Comptroller-General of Customs to refuse to enter into a trusted trader agreement is reviewable by the Administrative Appeals Tribunal—the AAT. The bill will allow the Comptroller-General of Customs to vary a trusted trader agreement following validation, including physical inspection and audit, to release an entity from certain statutory obligations or enable the entity to meet certain statutory obligations in an alternative manner. A decision of the Comptroller-General of Customs to refuse to vary a trusted trader agreement is reviewable by the AAT. The bill will allow the Comptroller-General of Customs to vary, suspend or terminate a trusted trader agreement unilaterally. A decision of the Comptroller-General of Customs to vary, suspend or terminate a trusted trader agreement is reviewable by the AAT. The bill will allow the Comptroller-General of Customs to publish and maintain a public register containing information in relation to each trusted trader agreement entered into. The bill will allow the Comptroller-General of Customs to make rules, a legislative instrument, in relation to the operations of the program.
In summary, the reform delivered through this bill will support the government's priority of ensuring Australia's ongoing success as an open economy. This bill will enable the Australian Border Force and the Department of Immigration and Border Protection to create stronger borders by shrinking the haystack. The commencement of this program will enhance Australia's capacity at the border to manage the growth in trade volumes by diverting resources away from highly compliant traders to focus on risk and noncompliance. I commend the bill to the House.
Question agreed to.
Bill read a second time.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
I am pleased to be able to speak to the Airports Amendment Bill 2015 on behalf of the Labor opposition. I am pleased to do so because it clears the way to progress the plan to build a second Sydney airport. The bill seeks to clear up deficiencies in aspects of the Airports Act 1996, which create uncertainty and confusion about the process for establishing a second Sydney airport. I make it clear that the inadequacies of the existing legislation I do not blame the current government for but former governments, I think, deserve some legitimate criticism for the fact that that this bill was necessary to clean up, frankly, what was very bad legislation in a couple of aspects.
In that context, Labor will support this bill that is before the parliament. That is because we believe Sydney needs a second airport sooner rather than later. It is inconceivable that the economic development of Australia's largest city should be held back by inadequate aviation facilities. That makes it critical that this parliament ensures that existing airport related legislation be fit for purpose.
We must ensure that the processes surrounding the development of a second airport are rigorous and comprehensive. In particular, we need to ensure that there is proper consultation with affected communities and that there be proper assessment of environmental impacts. This bill seeks to remove obstacles to the completion of these essential processes. It will help to ensure that the government gets the planning right, something vital for a piece of infrastructure as big and as important as a new airport. A new airport can drive employment and economic activity in Western Sydney. Indeed, the airport needs to be an airtropolis—something that is not just about planes going in and out but something that drives economic activity in job creation through the logistics sector, through the tourism sector and through the business sector for people in Western Sydney.
The Airports Act 1996 relates to existing federally leased airports. It is focused on regulating ownership, planning and development of those airports. Currently there are 21 federally leased airports including all of the main capital city airports around Australia. The act was put in place to manage the ongoing ownership and operation of our major airports following a process of privatisation of operations that occurred from the early 1990s through for more than a decade. One of those privatisations was the release of Sydney's Kingsford Smith Airport, a transaction that occurred in 2002 during the period of the Howard government. I have had cause to speak of the Kingsford Smith Airport privatisation in this place before. I have been critical of the process surrounding that transaction because I do not believe that the deal represented the best possible outcome for taxpayers. That is why it is not surprising that the legislation before us today seeks to deal with some of the unintended consequences of that flawed transaction.
This bill also addresses the fact that Sydney's airport is a greenfields development, something not contemplated by the regulatory structure of the current act. It also envisages the mandatory adoption of environmental conditions in any airport approval. The opposition welcomes this move because we believe that Sydney's second airport must be developed in accordance with environmental best practice. We strongly believe that our national infrastructure—roads, railway lines, ports and intermodal facilities—must have the capacity to handle the requirements of the 21st century.
But we also believe that when we deliver this infrastructure we should do so with the utmost consideration of the environment as well as the legitimate interests of residents living in the vicinity of such facilities. Our community needs top-quality infrastructure to maintain community expectations and to underpin the economic growth that will provide jobs for this and future generations. But we also need top-quality processes surrounding the delivery of that infrastructure. With a project of this size and scale, there is little margin for error in planning. This bill will improve the government's ability to get the planning right.
There is absolutely no doubt that the City of Sydney requires a second airport sooner rather than later. Those who believe otherwise are kidding themselves. Sydney is a global city. Its efficient operation is central to the economic productivity not just of New South Wales but of the entire nation. It is our major aviation hub. A delay at Sydney Airport has a knock-on impact around the nation because four out of every 10 aircraft pass through Sydney. When Sydney sneezes, aviation across the nation catches a cold.
The site of the existing airport is also problematic. Limited space and bottlenecks in the traffic networks surrounding the facility reduce the city's economic productivity. In terms of space, it is less than either a half or one-third the size of Brisbane and Melbourne airports. Its geography, surrounded by the most heavily densely populated area of Australia with a bay to the south, means that there is a problem with capacity at the airport.
To those who say that Sydney Airport can take more flights, I suggest that they talk to people who have regularly landed at Sydney Airport late but have still been unable to get access to a gate, simply because of its size and the constraints due to the land that Sydney Airport has been built on. These inordinate delays are a handbrake on national infrastructure, and when there is a delay in Sydney it impacts right around the network. Indeed, there are many Sydney based parliamentarians, colleagues, who drive to Canberra rather than fly, simply because they can be certain of what time they will get to their destination. Many business travellers complain about missing interstate meetings due to delays, and many families have had their interstate or international holiday plans disrupted by delays.
Several studies have shown that a second Sydney Airport is needed and that what you need is good evidence based policy. The evidence that Sydney needs a second airport is in. The policy response is to get on with the business of building it, and this legislation will facilitate just that. As minister I commissioned an aviation green paper and white paper process. Arising out of that, one of the recommendations was that there be a study into Sydney's aviation needs. This was funded as a joint New South Wales and federal study, commenced and completed under the former government.
The joint study reported on 2 March 2012. It was headed by the Secretary of the federal Department of Infrastructure and Transport, Mike Mrdak, and the head of New South Wales Planning, Sam Haddad. The study team also included the former Howard government minister Warwick Smith and Jennifer Westacott from the Business Council of Australia. The study found that air passenger demand in the Sydney region was forecast to more than double by 2035 to 87,000,000 passengers, and then double again by 2060. It recommended the adoption of a long-term strategy to meet this growth. It warned that the economic consequences of inaction would be dire, including a $6 billion loss in national GDP by 2035. New South Wales would be the hardest hit, with a loss of $2.3 billion in gross state product over the same period.
The 3,000-page comprehensive report made a range of recommendations and the key one was to support a second Sydney Airport. Sydney is full at peak hours now but the peak period is lengthening; pretty soon it will exist from between 7 am in the morning right through to 7 pm in the evening, with just a short period in between. This has an impact; because Sydney Airport is at peak for most of the day, a delay that occurs anywhere in the network takes longer and longer to get back into an on-time performance schedule. It is why, in terms of a response to this report, as transport minister I did everything possible to advance planning for a second Sydney Airport, including looking carefully at the options for the location of a second airport. It is also why, since a change of government in 2013, Labor has strongly supported the current government's actions to progress the proposal. A second airport for Sydney did not just require government action; it also required opposition support to make it a reality. If not, the impasse that has existed for far too long would have continued.
I make it clear today that my constructive approach to these issues will continue. The truth about major infrastructure projects is that sometimes a decision by the government of the day is not enough to achieve what is required. When it comes to nation-building infrastructure I believe that this parliament has a responsibility to take decisions that will benefit this generation and future generations. It requires political parties to put aside politics and work together in the national interest. It is about our economy, our productivity and our ability to grow as a nation.
Handled properly, a second airport can provide opportunity—jobs for tens of thousands of people in Western Sydney. Airports are job generators. The joint study found that, in the absence of a second airport in Sydney, the total number of jobs that will not be created is estimated to grow over time as unmet demand increases. This is averaged to be 12,700 in New South Wales and 17,300 nationally over the period from 2011. In 2060 alone the annual estimate of forgone jobs is approximately 57,000 in New South Wales and 77,900 nationally. Further, the jobs around airports are well-paid jobs.
The Grattan Institute undertook detailed research across Australia's capital cities last year looking at where the high-paying, high-productivity jobs are located. It found that CBDs were by far the largest centres of high-paying jobs. But it also noted that inner-city areas and secondary commercial hubs, such as those around large cities' airports, also tend to be more productive than other locations. A new airport not only brings jobs; it has the potential over time to bring higher paying, productivity-driving jobs to a location other than a CBD.
Airports, like universities, are one of the key attractors of related industries to their precincts. The importance of this cannot be overstated at this stage of Australia's economic development. As the 2013 State of Australian cities report—the last one that was actually published—made clear, our nation is undergoing a shift under which jobs growth is moving from the suburbs to the inner city. At the same time, housing remains affordable in suburban areas. This means that many Australians have to commute from homes in the outer suburbs to the inner city. This has given rise to the phenomenon of drive-in drive-out suburbs, where housing is affordable but jobs are scarce.
The social consequences of this trend are significant. It is indeed a tragedy that many Australian parents spend more time commuting in their cars than they spend at home playing with their children. There is also a risk that a lack of jobs close to where people live will entrench social disadvantage. One way that governments can address this trend is to invest in public transport. Regrettably, of course, the current government have cut public transport spending and do not believe in investing in it, although I note that they are very happy to come to openings of projects that have been funded by previous governments.
Another remedy is to focus on job creation closer to where people live. The construction of a second airport in Western Sydney will bring thousands of well-paid jobs to the region, not just in aviation but also in associated industries. A properly developed second Sydney airport will not only spark economic growth but also literally improve life for tens of thousands of people who will be able to live much closer to their workplaces. That means less time on the road, more time for family and friends and a better quality of life. The case for a second Sydney airport is therefore compelling, but, with the Commonwealth having chosen the site and already working on associated road infrastructure, it is important that we get the detailed planning right. We also need to ensure that the community has its say on the concept plan and that there is a proper and transparent analysis of environmental impacts.
Considerations like jobs and economic development, not to mention the meeting of economic need, do make the case for a second Sydney airport compelling. Still, there are those in parliament whose rigid ideology blinds them to the needs of a growing nation. I am somewhat disappointed, if not surprised, that the Greens political party in New South Wales have a formal policy that Sydney should not have a second airport. What is more, they also have a position that says they do not support Sydney's first airport, Kingsford Smith—that is, the Greens political party argue that a global city such as Sydney should not have an aviation facility. It is an absurd proposition, in which people could get into Sydney by parachuting out of planes as they fly over, but it is unclear how they could actually leave Sydney. It is an absurd proposition that goes to their irresponsible behaviour in economic policy, where they are prepared to say to any particular group what that group wants to hear.
The truth is that nation-building infrastructure, including airports, is vital for our quality of life and our standard of living. Constituents in my electorate are adversely affected by Kingsford Smith airport, but I accept that that is a by-product of a piece of infrastructure that is vital for not just Sydney but New South Wales and Australia, as a generator of economic activity and jobs. The Greens political party, of course, say that you can have no airport in Sydney or in Western Sydney but a high-speed rail line to a mythical location somewhere else. The problem with that is, of course, that a high-speed rail line would include 67 kilometres of tunnel through Sydney, which the study that I commissioned as minister showed would also in practice be likely to be opposed by the Greens political party, just like the Greens in the UK opposed the high-speed rail proposals that had the support at the last election in Britain of the UK Conservatives, the Liberal Democrats and the Labour Party. The fact is that they should not be allowed to have this absurd proposition whereby in inner Sydney they argue that they want to close Kingsford Smith, but they also argue against any location for a second airport.
The Labor Party will adopt a constructive approach to this. We understand that construction of a major project like a new airport is difficult to handle politically. We also realise that the imperative for action requires us to work in a constructive way with the government, and I believe I have done that. I do think, though, that part of building that community confidence is making sure that the environmental protections are very much there, and that is why we very much welcome the strengthening that is in this legislation.
One problem with the existing Airports Act is that it was designed to deal with existing federally leased airports, including in our other capital cities. The bill before us seeks to address the development of an airport on a greenfield site. It brings two existing processes together to address the initial development of a brand-new airport: the development of a master plan, which is more strategic and conceptual in nature, and the initial major development plans, which are in effect development applications that require Commonwealth consent. After the initial development is complete, the new airport will revert to the regular five-year approval arrangements that exist for all other federally leased airports.
Labor welcomes the bill's proposed strengthened role for the environment minister in making mandatory environmental conditions rather than, as is currently the case for other airports, making non-binding recommendations to the infrastructure and transport minister. Labor emphasises that the EIS process, which is being conducted under the Environment Protection and Biodiversity Conservation Act 1999, needs to be thorough, evidence based and transparent, with conditions that address environmental amenity as required.
We note that the minister has committed to allowing a full process of concurrent community input into both the airport plan and the EIS later this year. This is important. It is inevitable that not everyone will be pleased about the construction of a second Sydney airport. That is the nature of development. But it is essential that the community have its input, that community views are taken into account and that the government considers the community views in a responsible way.
The fact that this legislation is required now to address drafting issues highlights the inadequacy of the original legislation. For example, a condition on the sale of the Kingsford Smith airport was that the existing owner be given first right of refusal for the development of any second airport. In retrospect, it is clear that this condition included no additional revenue benefit for the Commonwealth and has reduced potential for competition in the sector. It is not a proposal that I believe is ideal.
This bill moves to emphasise that changed options for operation of the two Sydney airports continue to protect the lessee from exposure to the application of National Competition Law. It does so by exempting possible Sydney Airport Corporation Limited operation of both Kingsford Smith airport and the second airport from the 'substantial lessening of competition' rule in Competition Law.
We may well wonder what the ACCC would actually think about an arrangement for construction of a second airport that gives the inside running to the operator of the existing airport. There are competing views perhaps, but an open tender that included Sydney airport as an equal bidder would almost certainly have allowed more innovation, interest and, dare I say, sale proceeds to the Commonwealth than the closed process that begins in the first stage of this process.
We know that the ACCC is wary of the lack of regulation surrounding current port sales, as are many shippers and port lessees. At first glance, airports are not dissimilar. Sydney airport is one of four airports currently monitored by the ACCC in terms of service levels and prices.
The Howard government had a record of lazy privatisations. Look at the mess that followed the unreconstructed sale of Telstra, both the monopoly and contestable elements, with little regard to the consequences for Australian consumers and businesses. The coming into existence of the NBN was in part related to the legacy left to a future Labor government arising from that lazy sell-off process. The inclusion of the right of first refusal to the buyer of Kingsford Smith airport by the Howard government was done late in the process, and with little apparent regard to the interests of future users of airport facilities in Sydney.
This bill does not take away the contracted right of first refusal, but it clears the way for real contestability should Sydney airport not take up the government's offer. It is important to recognise that Sydney airport has the right of first refusal, not the right of veto—as I continually put to the former chairman of the Sydney airport, the now departed Max Moore-Wilton; I made clear my views about the conflicts that occurred with Mr Moore-Wilton. Specifically, this is done by providing for the possibility of unrelated owners operating Kingsford Smith and the second airport.
At the moment, it is extraordinary: if you had someone other than Kingsford Smith airport operating the second Sydney airport in terms of owning it then Kingsford Smith would still have to have the right to operate the second Sydney airport; therefore, completely vetoing in practice the ability of anyone other than Sydney airport to bid. That is just outrageous legislation that occurred. The former government that presided over that in 2002 should really stand condemned for the fact that this government is having to fix up that absurd proposition.
Of course, it also had in the legislation caps on cross-ownership of Sydney's second airport by the owners of Melbourne, Brisbane and Perth airports. Under the existing legislation, not only did you have that Sydney's second airport had to be operated by Kingsford Smith airport whether it owned it or not; you had ownership restrictions on what would be natural bidders for a second Sydney airport—that is, airports in other capital cities that are well run and with the experience of operating airports. This legislation fixes that up. It improves the negotiating position of the Commonwealth with the Sydney Airport Corporation, implementing what common sense tells you should have been the case from the very beginning.
While the opposition will be supporting this legislation as a means to ensure that we get the planning right, I do want to raise the fact that the rail connection needs to be built just as the roads need to be built. It makes no sense to go back after an airport is built and a runway is in place to build a railway line.
As much as an airport is a piece of economic infrastructure, it is also a public asset. To facilitate its efficient use, it should be connected to the existing public transport network. A rail link that connects the existing south-west line—that has been extended thanks to the decision of the former Rees government in New South Wales—to the western line should be part of the initial development. That would ensure it was built into the price when the airport is leased as well.
This would mean benefit for the people of Western and south-western Sydney regardless of whether they are going to airport or not. That is an example of what can drive public support for this proposal. I think very strongly that this should occur. During the New South Wales election, I did a press conference with the New South Wales Labor leader Luke Foley to express our view there. I would urge the government to have a close look at the propositions that we have put forward in a constructive way and get on with ensuring that this occurs.
The fact is that no airport, without public transport access, operates as well as an airport once it has that public transport access. Look at Melbourne: decades after the new airport was opened, they still do not have rail access, and it is still an issue. It is far harder once the airport has been built to go back and deal with those issues.
In conclusion, one of the key responsibilities of elected office is to think about the future. One of the reasons I am attracted to the infrastructure portfolio is that you can make a difference, not for a year or a political term but for generations to come. Western Sydney has a population now of over two million people. Think of Adelaide not having any airport at all. That is a relevant factor here. This is about provision of infrastructure, provision of highly paid jobs and driving that economic reform.
After working in government to lay the groundwork for a decision about the second airport, Labor will continue to play a constructive role in making the project a reality, but in doing so we insist on proper process. I acknowledge the fact that the minister and Assistant Minister Briggs have been available for consultation and have ensured that this project has moved forward in a way that is above politics. That is necessary. We also need though to bring the public with the government on this proposition. That is why a proper assessment of the environmental impact, ensuring that there is value for public money in this process and ensuring that we maximise the job creation and the public benefit that can come out of a second airport are so important. I commend this bill to the House.
I rise to speak on the Airports Amendment Bill 2015. It is a very rare circumstance that I get to follow the member for Grayndler and actually agree with the vast majority of what he said, especially the attack that the member for Grayndler made on his coalition partner, the Greens, and their hysterical plans or discussions on the Sydney airport issue.
I grew up in Peakhurst opposite the old tip at Gannons Park. We were right under the old east-west flight path. Every afternoon we would come home from school and sit and watch the aircraft roll in from the west over the top of our house on their way to land at Kingsford Smith. I remember my old Peakhurst high school economics teacher, Mr Simpson, saying when we had discussions about Sydney's second airport back in the 1970s that he thought that there would never be a decision about Sydney's second airport in our lifetime. We discussed back in the 1970s the difficulty of making a decision about where Sydney's second airport would be.
Of course there were studies and studies. There was the possibility of Bankstown and Holsworthy. There were various places mentioned for Sydney's second airport. It took the current Prime Minister, Tony Abbott, to have the courage to make that decision that is best not only for Sydney's future but for Western Sydney's future and the nation's future. He made the decision back on 15 April that Badgerys Creek would be the site of Sydney's second airport. But I say that this will not be Sydney's second airport; I say this will be the first airport for Sydney west. Western Sydney today is a large, economically powerful entity by itself. It deserves and needs its own airport. That is what Badgerys Creek will give us. It will be a major boost for the local economy. It will create thousands of jobs. It will be a catalyst for investment in education, science, research and aeronautical industries. This will be the catalyst that will kick off Western Sydney.
Already we are seeing roads under construction. We saw as part of the $3.6 billion Western Sydney Infrastructure Plan the Prime Minister break ground on Bringelly Road on 20 January this year. The construction of the Northern Road is expected to begin in late 2015. The construction of the new motorway connecting the M7 to the northern motorway is expected to commence in 2019. The $5 million upgrade of the Ross Street intersection at Glenbrook was added on 5 March this year, with planning for the project to begin this year.
These things are all very important, especially to increase our nation's tourism. Tourism is an area where we in this country have great future prospects. The recent ABS numbers show that there has been a four per cent increase on the previous year. We will see that increase continue. As China, India and other Asian countries become economically stronger more of their population will want to travel to Australia, so we need to make sure we have an efficient airport network so they can come to visit Sydney, especially Western Sydney.
There is one issue, and this is where I am in some agreeance with the member for Grayndler. It would have been far better if we had not sold Sydney (Kingsford Smith) Airport and had that clause providing Sydney Airport Corporation, the successful bidder, with the first right of refusal, but we need to remember those times. The previous coalition government may be criticised for that, but let us not forget that they had to pay back $96 billion worth of the previous Labor government's debt. As well as that $96 billion, they had a $54 billion interest bill that had to be paid. So it is very easy to criticise them here in 2015, but we know back then they had the onerous task of paying back the previous Labor government's debt, which they did so successfully.
I would like to see—and I think it would be best for Sydney, for Western Sydney and for our nation—Sydney west airport and Kingsford Smith airport owned by separate identities so that they are in vigorous competition with each other. That would be best for the nation. I can remember when Sydney Airport Corporation first took over Sydney airport going to the airport with a load of samples and getting a trolley, which you used to pay a few dollars for. I remember the charge was originally $1 or $2. Normally I would carry my bag and not worry about it, but when I walked up to the trolley I found they had put the cost up to $5. I can remember another time seeing in the arrival hall that some bright spark had decided it would be a good idea to charge the incoming passengers money to take a trolley to put their bag on. People coming off international flights were meant to have $5 in Australian currency. These are the issues we get if we do not have effective competition in this area. That is what this bill actually does. It helps address those issues.
Yes, Sydney Airport Corporation still has the first right of refusal to develop any second airport within 100 kilometres of Sydney's centre and the Airports Act currently prohibits the Commonwealth from taking either of the actions that we want to to enable another entity to take ownership of this airport in the event that the Sydney airport group decline to accept the offer. Section 18 of the Airports Act requires that the airport lessee companies of Sydney—which is Kingsford Smith—and the airport site declared to be Sydney West Airport, as it is referred to in the Airports Act, must be subsidiaries of the same company. This is the legacy provision from 1996 which I discussed previously. This bill removes the requirement of common ownership, providing the Commonwealth with the commercial flexibility to deal with third parties and to develop the airport itself. So we are sending a clear message to Sydney Airport's corporation that we in this government are very serious and that, if they do not accept the terms that are put together, we would like to see competition between those two airports.
In the time remaining, there are a couple of other issues involving airports and competition. Firstly, airports and competition show some of the complete inadequacies of our competition law that the recent Harper review failed to address. I am referring to the issue of price discrimination. While the US has the Robinson-Patman Anti-Price Discrimination Act, in the EU they have a thing called article 82, which also is an effective provision against anticompetitive price discrimination. Article 82(c) provides that abuse by a company with a dominant position may, in particular, consist of:
…applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage …
We have no such provisions in our competition laws. The Harper review makes no recommendations that we have such provisions in our competition laws.
I can give an example of how this can apply to airports and why it is very important. In July 2000, there was a decision by the European Commission called the Spanish airports decision. What happened in that case was that they found that the airports in Spain were operating what they called a discount structure, or charging smaller airlines a higher price. If you were an airline and you made one to 50 landings a month, you paid the rack price; if you made 51 to 100 landings, you got a nine per cent discount; with 101 to 150 landings per month, you got a 17 per cent discount; with 151 to 200 landings, you got a 26 per cent discount; and with more than 200 you got a 35 per cent discount. So, if you were a large airline operator with a lot of flights and a lot of planes, you were able to get a 35 per cent discount on your landing fees in airports in Spain against a smaller operator. This had the potential to destroy competition. It prevented new operators that were coming into the airline industry in Europe and landing in Spain from being able to compete on a level playing field. What the EU found was that that structure of charging those smaller competitors a higher price was anticompetitive, and they banned it. They said:
The existence of economies of scale, the aim of reducing air traffic noise or air congestion, for example, could be regarded as objective reasons—
for such discrimination.
However, in the case of landing and take-off services such economies of scale do not exist. The services provided do not depend on the individual owner of the aircraft or whether they are rendered to the first or the tenth aircraft of the same airline.
They found that the fact that an airport:
… has applied dissimilar conditions to its commercial customers for the provision of equivalent services, thereby placing some of them at a competitive disadvantage, constitutes an abuse of a dominant position within the meaning of … Article 82.
We have no such provisions in our competition laws, and that threatens effective competition in our airline industry.
The other issue I would like to talk about quickly is that I fear that we are making a terrible mistake involving the Moorebank Intermodal. By having an intermodal at Moorebank instead of at Badgerys Creek, we are losing one of our abilities to fund the railway line into Badgerys Creek. The member for Grayndler emphasised the importance of building that railway line, but our funding is not unlimited. By investing in Moorebank—by pouring Commonwealth money down the toilet in Moorebank—we are simply making it harder and harder. That money should have been put into the rail link to get it set up at Badgerys Creek.
That draws me to an article that I came across after reading an article by Nick Cater today. This article is called 'Policy and planning for large infrastructure projects: problems, causes, cures'. It is a World Bank working policy from December 2005, and it talks about the exact problem that we have with Badgerys Creek, the 'planning fallacy'. It says:
… a major problem in the planning of large infrastructure projects is the high level of misinformation about costs and benefits that decision makers face in deciding whether to build, and the high risks such misinformation generates.
This is exactly what we have at Moorebank. It goes on, and it cites examples of how forecasts for rail projects have failed. It does a study across different continents, and for rail transportation infrastructure projects it finds the cost overruns, averaged across more than 50 projects, are 44.7 per cent measured in prices. It finds not only that the cost is more than 40 per cent higher but that the actual passage of traffic is 51 per cent lower than predicted. We have seen this in Sydney with our planning debacles: the Cross City Tunnel and the Lane Cove Tunnel. We have seen this in Brisbane. The article goes on:
Again, this is what we are at risk of seeing at Moorebank. It goes on to ask why this is happening, and it says:
In the grip of the planning fallacy, planners and project promoters make decisions based on delusional optimism rather than on a rational weighting of gains, losses, and probabilities. They overestimate benefits and underestimate costs. They involuntarily spin scenarios of success and overlook the potential for mistakes and miscalculations.
That sums up the Moorebank Intermodal to a tee. It also gives a warning about how to overcome this. It says:
The key weapons in the war on … waste are accountability and critical questioning.
That is again the problem that we have with Moorebank. There is simply no answering of the critical questions. There are three completely failed premises: it takes trucks off the road, it reduces air pollution and it saves costs. Any critical analysis of those three premises shows that they are completely faulty. In the Moorebank Intermodal, we have another complete planning fallacy. This should be combined with the airport at Badgerys Creek.
We have had the warning also from Infrastructure New South Wales. They have warned that the case has not been proven for Sydney for intracity intermodals. They have said that Enfield is a test case. Enfield has already been delayed by two years. We would be far better off if, instead of keeping that money down the toilet in the Moorebank Intermodal, we invested it in getting the rail infrastructure into Badgerys Creek, which will be a fantastic development for Western Sydney. Having said that, this is a good bill and I commend it to the House.
I support the passage of the Airports Amendment Bill 2015. As someone who has lived within five kilometres of Kingsford Smith Airport for my whole life, it is a welcome development to see the Commonwealth parliament making progress on the development of a second airport for Sydney's west. I recall that, when I used to live in Botany, I could walk out into my backyard and count the number of rivets on the undercarriage of a jumbo as it flew over our backyard. So it is nice to see that progress is being made on a second Sydney airport.
This bill will amend the Airports Act to provide for the determination of an airport plan for Sydney West Airport. This is a temporary, transitional measure which authorises the initial airport development for Sydney West Airport and specifies the Australian government's requirements for the airport. The bill also includes some measures that increase the options available to the Australian government in respect of who operates the airport should Southern Cross Airports Corporation decline a contractual offer that they have to develop the airport. This is necessary to give full effect to the Commonwealth's contractual rights in relation to Sydney West Airport. Separately, to progress the project and prepare for the declaration of the land at Badgerys Creek as an airport site, the bill deals with some of the environmental matters.
I represent the community which has Sydney's airport in its electorate. Our community experiences the advantages of this vital piece of infrastructure through proximity to the country's No. 1 airport and the economic opportunities that that creates. Quite simply, airports are economic powerhouses. They create many, many jobs, and many of the friends that I went to school with have jobs that relate to the airport. Indeed, my father spent 37 years working for Qantas in an airport related job. So I know and understand the economic benefits that flow not only to direct jobs but also ancillary industries, in logistics and other services, around airports.
But of course with airports come challenges, most notably through traffic congestion and airport noise. Sydney's airport is among Australia's most significant pieces of transport infrastructure but it is located, very, very close to quite a dense residential area and it is probably one of the closest international airports to a CBD in the world. It facilitates the movement of more than 36 million passengers and 395,000 tonnes of international air freight annually.
The economic impact of Sydney Airport which emanates from the 800 businesses that operate within the airport precinct, and associated with tourism and trade and capital expenditure, is huge. In 2012, businesses operating within the airport's precinct contributed an estimated $9.3 billion in value added, with associated employment of close to 50,000 full-time equivalent jobs. The contribution of tourism and freight facilitated by the airport represented a further $18.3 billion in value added and generated an estimated 230,000 full-time jobs.
Sydney Airport is vital to the nation's productivity and prosperity. Studies have shown that a second airport will also be a huge benefit and will deal with an emerging need in respect of air services in the Sydney Basin. The Grattan Institute's Mapping Australia's economy report of July 2014 undertook detailed research across Australia's capital cities looking at where the high-paying, high-productivity jobs were located. It found:
The intense economic contribution of CBDs occurs partly because of the concentration of jobs in these areas. But CBD businesses are also much more productive on average than those in other areas. Inner city areas and secondary commercial hubs, such as those around large cities' airports, also tend to be more productive than other locations.
So a new airport will not only bring jobs; it also has the potential, over time, to bring higher paying, higher productivity jobs to a location other than the CBD. Airports, like universities, are key attracters of related businesses in such precincts.
This bill is an initial stage in facilitating the plan for the second airport in Sydney. It proposes to amend the Airports Act to improve some of the environmental processes associated with planning for Sydney's second airport and to address issues arising from unintended consequences of the act relating to the privatisation of Sydney Airport. It will also strengthen the environmental assessment process around the second airport, by combining the initial concept and major development plan into one consolidated airport plan and requiring the environment minister's decision arising from an EIS on the plan. This will be mandated rather than just a source of advice to the infrastructure minister. In that respect, Labor welcomes the bill's proposed strengthening of the role for the environment minister when it comes to the EIS.
The bill will also amend the act to remove the current provisions that would mean that the operators of Kingsford Smith airport, SACL, or Sydney Airport Corporation Limited, are mandated to also operate the second airport, regardless of ownership, and it will amend the act to allow other airports to bid for the second airport, should Sydney Airport Corporation not take up the initial option of the first right of refusal on the airport.
This is a very important reform and something that probably should have been done initially. I think most people probably recognise that is now the case. We all know about the costs of setting foot in Sydney airport, for parking and other services that are provided, and they primarily relate to the fact that there is no competition around the airport in terms of the provision of services. This amendment will go some of the way to perhaps providing additional competition by making it possible for operators of other airports—or, indeed, new operators—to come in, should SACL not take up the initial offer. In some respects, this rectifies what I think was a huge error on behalf of the Howard government in respect of the initial sale of Sydney airport. The first right of refusal was tacked on, at the 11th hour, to those sale negotiations without any real additional revenue associated with its inclusion. It also reduces the potential for competition in the sector and has no regard to the interests of future users of airport facilities in Sydney.
Although the bill does not take away that contractual right that Sydney Airport Corporation Limited has in respect to first right of refusal, it clears the way for some contestability should Sydney airport not take up that initial offer. That is done specifically by allowing the Commonwealth to take a refused offer to other bidders and by removing the existing 15 per cent caps on cross ownership of Sydney's second airport by the owners of Melbourne, Brisbane and Perth airports. This will improve the negotiating position of the Commonwealth with Sydney Airport Corporation, implementing what was presumably intended at the time of the contract.
Proper planning for the second airport also means building rail links as part of an original development. It is very important, if we are going to undertake such a major infrastructure development, that we get the planning right, particularly in respect of transport in and out of the facility and indeed around the area. That must include a public transport plan for the second airport. Unfortunately, the refusal of the Abbott government to fund urban passenger rail projects means that there is a real possibility that a rail link will not be built at the same time as the airport. A rail link that connects the existing south-west rail line to the western line via the airport and related developments should be part of an initial development proposal and not delayed because of the government's approach to public transport.
In conclusion, I am very pleased to see this bill which has been brought to the House. It is progress being made on the development of a second airport for Sydney. It tidies up some of the contractual deficiencies that have existed in respect of the development of a second airport, and it will streamline and improve the environmental assessment process. On that basis, I commend the bill to the House.
I would like to thank all members, particularly the members for Kingsford Smith and Grayndler for their support. I just need to correct one issue: the Abbott government is contributing to public transport projects through Asset Recycling Initiative. In fact, we will arguably be the biggest contributor to public transport rail projects in the Commonwealth's history. But other than that small factual error from the members for Grayndler and Kingsford Smith, we welcome their support and their contributions to the debate.
The Western Sydney airport development is an incredibly exciting project for Western Sydney. It is not a second airport in Sydney; it is the first airport for Western Sydney. The airport will be a key driver for economic development in Western Sydney and will be a catalyst for investment into the future in the education, science research and aeronautical industries. On top of this, the Abbott government, in partnership with the New South Wales government, is investing $3.6 billion in local infrastructure through the Western Sydney infrastructure package, and those projects are underway. The Bringelly Road project began in January, when the Prime Minister and Premier Baird turned the first sod, and more projects are shortly to begin.
The Airports Amendment Bill 2015 amends the Airports Act 1996 to provide for the creation of an airport plan for the proposed Western Sydney airport, in recognition of the different requirements the airport has as a greenfield development. Importantly, the bill recognises that the environmental assessment process currently underway for the airport is a key part of the approvals processes and confers an approval function on the environment minister in relation to environmental matters. In this way, the bill will require the Minister for Infrastructure and Regional Development and Deputy Prime Minister to incorporate in the plan any environmental conditions imposed by the Minister for the Environment, following completion of the environmental impact statement. Preparation of a new and robust EIS is underway, and the community will have their opportunity to have a say on the draft EIS later this year.
The bill also includes measures that would help the government consider alternative operators, should Sydney airport group turn down an offer to develop and operate the proposed airport under the first right of refusal process, and it also removes cross-ownership restrictions currently placed on the Western Sydney airport. The bill contains some mechanical provisions to facilitate declaration of the airport site and other preparatory works. Again, I thank all members for their contributions to the debate and commend the bill to the House.
Question agreed to.
Bill read a second time.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
I am pleased to rise to speak on the Copyright Amendment (Online Infringement) Bill 2015. This is an important bill which will provide an effective mechanism for copyright owners to disrupt the supply of infringing copyright content to Australian consumers. I would like to emphasise three points in my remarks this evening: firstly, there is a growing issue with copyright infringement in digital media; secondly, there is a need to take action to address this problem; and, thirdly, I want to speak about the measures in the bill which are directed to addressing the problem.
Let me start with the growing problem of copyright infringement. The copyright framework has existed for centuries. The policy rationale is to give creatives an incentive to engage in the intellectual and creative effort to produce works—and that incentive arises because they can capture remuneration for their work. Typically, and traditionally, the copyright framework has worked on the basis that the work—be it a literary work, an artistic work or a musical work—is created and then it is disseminated on a per unit basis. That might be the number of records sold, the number of books sold or the number of movie tickets sold. Historically, there has been a physical production process which is difficult to replicate. It is not easy to replicate the printing of a book if you are not the copyright owner; it can be done but it is not the easiest thing in the world to do.
The policy framework for copyright has always involved the striking of a balance between the rights of the creators and owners of copyrighted works and the users and disseminators of those works. Striking that balance is never a simple or straightforward exercise; there are a range of considerations to weigh up. What we have seen, however, over the last 20 to 25 years is a new factor which has made the policy issues in this space even more complex, and that is the rise of digital technology as the means by which artistic, literary and creative works are disseminated. The way most people in Australia and other advanced nations—indeed, most nations—access music, movies, television or books today is almost invariably over a digital pathway.
There are a whole range of very telling statistics that can be quoted in substantiation of that proposition. Let me quote a few statistics from a compilation prepared by Teresa Sperti, an expert in digital marketing. She has drawn together some interesting statistics from a range of reputable sources. For example, the Sensis e-Business Report 2014 noted that 56 per cent of Australians now own a tablet device and 77 per cent now own a smart phone. The Deloitte Media Consumer Survey2014 noted that the internet, as a preferred source of entertainment, continues to grow at roughly 10 per cent per year. Indeed, among all Australian consumer in that survey, the percentage of people who ranked television as their preferred source of entertainment was 64 per cent and the percentage who ranked the internet as their preferred source for social or personal interests was 63 per cent; and it was expected that the crossover between the two would occur this year—that is, the internet would become the most preferred source of entertainment. So digital mediums for the dissemination of material continue to become ever more important. Another interesting statistic is that, according to the Deloitte Media Consumer Survey, some 32 per cent of Australians purchase e-books and, of those who do purchase e-books, two-thirds are reading more digital books than printed books. So there is ample evidence to support the proposition that content is being generated and disseminated using digital technology.
From the point of view of both producer and consumer, digital technology is much more efficient and rapid than the traditional technologies. But one of the consequences of digital technology is that it is much easier to copy a work than it hitherto was. Indeed, thanks to digital technology the copy can be indistinguishable in quality from the original work. The policy risk this presents is that we will end up in a world where it becomes very difficult to protect your copyright in a work. That tends to undermine the incentives of creators and also those in the business of disseminating content.
We know that we do have an issue in Australia with online copyright infringement. Indeed, Australia is a jurisdiction which has a relatively high rate of online copyright infringement, or illegal downloading. According to some recent research, some 21 per cent of all Australians over the age of 18 have engaged in illegal downloading. A statistic which should not fill us with pride is that 11.6 per cent of all illegal downloads of Game of Thrones happen in Australia. That is a percentage vastly in excess of our percentage of the global population. According to 2014 research prepared by the IP Awareness Foundation, online film and television piracy is increasing, with 29 per cent of Australians admitting to being active pirates. That same research found that one in four teenagers engages in the downloading or streaming of infringing film or television content. So we do have a growing problem with copyright infringement when it comes to digital media.
I want to turn now to why it is important that we do what we can to address this issue. There are good policy reasons why seeking to address the issue of online copyright infringement is something that government should aim to do. To start with, it is clearly important that we are seen as a jurisdiction, a market, which respects and enforces copyright. That is critical to having and maintaining a vigorous set of creative industries in Australia in fields as diverse as film, television, music, literature and so on. According to a 2012 report by PricewaterhouseCoopers, the range of Australia's industries that are subject to copyright protection employ some 900,000 people and generate economic value exceeding $90 billion, including $7 billion in exports. But of course, as I have been arguing, digitisation has tended to mean that these industries are particularly susceptible to harm from online copyright infringement. Of course a second factor is that, potentially, online copyright infringement can be harmful to consumers.
A third issue that we need to take account of, as we identify reasons why it is important to see if we can fix this issue, is that there are deficiencies in the current law of copyright, meaning that it is not a fit-for-purpose tool in some ways in allowing rights holders to efficiently enforce their rights in this modern digital world. For one thing, there are a number of foreign based websites that disseminate large amounts of infringing content to Australian internet users, and presently they are able to operate, in practical terms, without disruption, and their operators can secure a profit from facilitating the streaming and downloading by end users of infringing copies of audiovisual material. And of course the legitimate owners of that material do not share in the returns which are generated. In fact, if we are clear about what is occurring here, unlawfully accessing and then profiting from the intellectual and artistic endeavour of others is a form of theft.
Today, however, rights holders face a number of practical barriers when it comes to seeking to enforce their rights against the operators of these sites and these services. The most practical barrier of all is that the website that is facilitating this type of infringement, the operators of which are engaging in this form of intellectual property theft, is typically located in a jurisdiction where it is very difficult, if not completely impractical, to take legal proceedings. So we have a specific problem in the current regulatory and legal framework which is available to the owners of copyright to enforce their rights: that it can be very hard to take enforcement action against entities which are operating outside Australia. You would need to seek an injunction from a court, which requires lengthy and costly civil proceedings, and, because infringement is occurring on quite a large scale, it is often not viable for rights holders to enforce their rights against individual users.
It is important to acknowledge that there is a range of factors at play here, and it has been argued by a number of people in this debate that one factor has been that global rights holders tend to bring content to Australia later than it is made available in other markets and at higher prices. On that front, it is important to acknowledge that rights holders have changed some of their practices in recent years, and there are a number of constructive developments that we have seen in the last year or so. We saw Foxtel, for example, lowering its prices late last year, and we have seen new streaming services—Stan, Presto and Netflix—operating in Australia providing greater access to consumers for legitimate content at reasonable prices.
Let me turn now to the key mechanisms in this bill which are designed to facilitate copyright owners taking action to disrupt the supply of infringing copyright content to Australian consumers. Specifically, the bill will enable copyright owners to apply to the Federal Court for an order requiring a carriage service provider—typically, that is going to be an internet service provider, one of the companies through which most Australians obtain their internet connectivity; so it is an order requiring an internet service provider—to block access to what the bill calls 'online locations' where those locations infringe or facilitate the infringement of copyright and that infringement is in fact the primary purpose of those online locations. I think that, for present purposes, we can understand 'online location' as primarily meaning a website, but, nevertheless, that language has been used to take account of the rate at which technology changes and of course the mode of operation of some technologies where bits of content are spread very widely amongst multiple locations.
Provisions of the kind contained in the bill have been used in other jurisdictions, including the UK, Ireland and Singapore, and in these jurisdictions an injunction is often ordered without any opposition from the internet service provider concerned. The provisions in the bill have been drafted carefully to ensure that the new injunction power will not affect legitimate websites and services that legally provide access to copyright material. Importantly, the provision will apply on a no-fault basis against the carriage service provider—that is to say, the internet service provider. This recognises that it is not necessarily the case that carriage service providers are responsible for the infringing online locations. They are, however, best placed in a practical sense to facilitate Australian internet users being prevented from accessing those locations. So there is a clear distinction being drawn between whether internet service providers are responsible for the infringement—that is not being asserted; that is not the policy basis underlying this bill—and, on the other hand, whether internet service providers are the party best placed to facilitate the legitimate rights of copyright owners being protected against those who are engaging in infringing behaviour. Importantly, the legislation has been drafted with a view to ensuring that the power in it is only as broad as it needs to be to achieve its objectives and no broader.
There has been extensive consultation conducted on these measures, including a discussion paper released last year by the Attorney-General and the Minister for Communications, and a number of submissions—quite a number of submissions—were made in response to that discussion paper, and there are certainly measures in this bill which respond to comments made in those submissions.
Copyright protection is an essential mechanism for ensuring the viability and success of creative industries by providing an incentive for and a reward to creators. That is the underlying policy rationale for why the government is taking action here in this legislation, with a view to reducing the rate of online copyright infringement in Australia. The government does want to acknowledge the collaboration and cooperation of a range of parties, including internet service providers as well as rights holders, in developing this framework. The government looks forward to the ongoing cooperation of these stakeholders as we move to implement this framework.
I rise to speak to the Copyright Amendment (Online Infringement) Bill 2015. Labor will support this bill after closely considering it in the Senate Legal and Constitutional Affairs Committee.
The bill makes a modest but, I believe, worthwhile contribution to the suite of measures required to deal with Australia's copyright piracy problem. Copyright law is vital to fostering creativity and innovation. The national arts policy that Labor introduced while in government—Creative Australia—noted this. It expressly acknowledged:
… the role that Australian copyright plays as the primary legal framework supporting the creative economy.
Copyright law protects the rights of all those who produce original artistic or intellectual work. The very livelihoods of artists, authors, musicians, composers, writers and performers depend upon it. I am the son of a composer; I know very well the vital role of copyright laws in supporting the work of creative people.
Given how central copyright protections are to supporting creative activity of all kinds, we should be deeply concerned about the current level of online piracy. We should not mince words about this: Australia has a very serious problem with piracy. Available figures indicate that it is one of the worst in the developed world. A lot of the public debate about this topic is focused on popular foreign content, like Game of Thrones. But when Australian audiences pirate creative work it is Australian creative industries which suffer disproportionately. It is the livelihood of Australians employed in those industries which is threatened. Market research indicates that movie piracy alone costs the Australian economy $1.37 billion worth of sales, $193 million in tax revenue and 6,100 FTE jobs each year. If the arts are to thrive in Australia—if we are to be a Creative Nation—then we must have appropriate copyright protections and the measures necessary to enforce them. The current level of online piracy clearly necessitates government action.
This bill is a modest but definitely worthwhile contribution to that work. The bill implements a site-blocking process under which rights holders can seek a Federal Court injunction requiring ISPs to block overseas websites that have the primary purpose of infringing copyright or facilitating the infringement of copyright. I know that some rights holders felt that this standard—the primary purpose test—was too high. The Senate Legal and Constitutional Affairs Committee looked closely at this question and decided that the test is appropriate, and I endorse that conclusion. However, to clarify matters, the committee recommended the insertion of a legislative note into the bill, a recommendation which the government has accepted. This note explains that the primary purpose test does not have the perverse outcome that a piracy website's primary purpose is held to be, for instance, making money, even though it does so by means of copyright infringement. I hope that this amendment reassures rights holders that though the threshold test is certainly rigorous, we want this bill to be practical.
In deciding whether to make an order under this bill, the court will take account of a range of factors, including the flagrancy of the infringement or facilitation of infringement by a site, whether the site shows a disregard for copyright generally and whether the website contains a directory or index of ways to infringe copyright. On the other hand, the court will consider whether other remedies under the copyright law are available. Importantly, the court will consider the impact of a site-blocking order on any other person or class of persons, and whether to make such an order would be a proportionate response in the circumstances,
That test—the primary purpose test—and the range of factors the court is asked to consider are key. Those features of the bill make it clear that it is aimed at a very specific mischief; the power it confers is intended to be exercised very carefully and in limited circumstances. The bill is directed, essentially, at the worst of the worst. It is intended to give rights holders a remedy against a category of websites which deliberately and flagrantly flout copyright laws and operate as havens for pirate activity. It is galling that they turn a handsome profit in doing so.
A blocking mechanism is necessary because these websites are hosted overseas. Were they hosted within Australia, they would be able to be dealt with by the ordinary remedies of the copyright law. Nonetheless, ordering that access by Australian internet users to a given website be blocked is obviously a very serious step. It is appropriate that this kind of power be exercised not by executive government, but by a court. It is appropriate that in exercising that power the court takes account of the public interest, as the bill provides.
One difficulty, of course, with a site-blocking measure is that it necessarily has an impact on ISPs, even though they cannot reasonably be held responsible for the pirate activity of foreign websites accessed through their services. This bill recognises that difficulty. The bill makes clear that an ISP is not liable to pay any of the legal costs involved in applying for a site-blocking order unless they contest the application. Once this law is established and the courts have developed some expertise in making the relevant orders, I expect that most applications will be dealt with in an efficient, cooperative manner.
When the government proposed this legislation in its discussion paper on online piracy released in July last year, it indicated:
Rights holders would be required to meet any reasonable costs associated with an ISP giving effect to an order and to indemnify the ISP against any damages claimed by a third party.
The bill before the parliament, however, is silent on this point. The Senate Legal and Constitutional Affairs Committee has queried this. In its report tabled 11 June, the committee recommended that the government provide a full explanation of how costs and liability incurred by ISPs in compliance with site blocking orders will be handled. I strongly endorse that recommendation and await the government's explanation.
I have explained the intent and effect of the bill. I also want to be very clear about what this bill is not targeted at and the type of websites its terms will not capture. This bill is not, as some have sought to claim, an internet filter of any kind. It is a judicial remedy for conduct in flagrant violation of the law. This remedy is available only where the quite strict requirements of the bill are met. Make no mistake: the type of websites this bill deals with, were they hosted in Australia rather than abroad, could be ordered to be taken down under existing copyright law.
This bill does not allow rights holders to seek injunctions against virtual private network providers—or VPNs. VPNs have a range of legitimate purposes and do not meet the threshold primary purpose test in this bill. As the Minister for Communications noted in his second reading speech, many Australians use VPNs to appear as though they were in another country in order to access legitimate content which is available in that country. As the minister explained, this bill does not address that kind of conduct. Use of a VPN to access overseas content may be in breach of certain contractual arrangements but it does not breach Australian copyright law. However, there remains substantial concern in the community about this issue and, as such, the Senate Legal and Constitutional Affairs Committee wisely suggested that the government provide reassurance about this matter in the explanatory memorandum to the bill. I know the government accepts this recommendation, and I look forward to the government attending to this suggestion.
As I have said, this bill is a modest and, I believe, common-sense measure. I expect that it will make a fair dent into online infringement in Australia and that it will disrupt the operation of websites which flout the law. But this bill, and other measures which seek to deter copyright infringement, can only ever be part of the answer. We must encourage the use of legitimate content. No legislative measure will deal with piracy more effectively than the provision to the Australian market of a broad range of content in a timely and affordable manner. This is ultimately a matter for business, and not for government or this parliament, to address.
I firmly believe that Australians are, by their nature, law-abiding people. What is more, they understand the value of creative labour and want to access legitimate content and support artists. Indeed, as I said earlier, many thousands of Australians apparently go to great technological lengths in order to pay for legitimate content overseas. I am pleased by the recent progress that has been made in this regard and I hope it continues. Devising better ways of delivering content to Australian consumers is a commercial and not a policy challenge. Business must adapt to the challenges of the new digital economy. But government does have a role in setting the policy and the legal framework. As I noted earlier, Labor's Creative Australia policy affirmed 'the role that Australian copyright plays as the primary legal framework supporting the creative economy'. This does not entitle us to rest on our laurels. Copyright law supports creativity and innovation in our culture, in our society and in our economy. If we allow our copyright law to become outdated, obsolete, we cannot expect to thrive in the new digital economy.
Australia's current copyright law was conceptualised and drafted before the first email was ever sent—when the modern internet was scarcely imaginable. It was enacted fully three decades before the invention of Google in an era when a visit to the library necessitated rifling through a card catalogue. The law is, needless to say, in need of a thorough overhaul. It was for this reason that Labor tasked the Australian Law Reform Commission with investigating how the copyright law could be updated for the needs of the digital age. The commission provided its report to the then newly-minted Attorney-General, Senator Brandis, in November 2013.
Early in February 2014, Senator Brandis undertook to pursue a root and branch reform of the copyright law in response to that report. The Copyright Act, Senator Brandis said quite rightly, is, 'overly long, unnecessarily complex, often comically outdated and all too often, in its administration, pointlessly bureaucratic.' Senator Brandis promised that he would conduct 'a thorough and exhaustive exercise in law reform' to remedy this and yet Senator Brandis has produced nothing. More than 18 months after receiving it, the government is yet to respond to the Australian Law Reform Commission's report. It has not even begun to grapple with the very serious body of work the commission produced. Farcically, when Senator Brandis is asked time and again what his government will do on copyright reform, he tells the parliament that the government is still considering the commission's report.
Senator Brandis did, in his discussion paper of last July, endorse a proposed extension of the safe harbour scheme, an idea worth serious consideration, but even this one mooted reform has apparently fallen by the wayside. The government has not pursued the proposal—though I note that the Senate committee considers it an option worthy of further consideration. This is simply not good enough from the government. Australia cannot hope to support our creative industries nor to encourage new digital practices in business, education and academia if our copyright law is allowed to lapse into obsolescence.
Mark Twain, at the turn of the last century, said, 'Only one thing is impossible for God: to find any sense in any copyright law on the planet.' I do not share his pessimism. Given some leadership from the government, this parliament is without doubt capable of passing reasonable, clear and up-to-date copyright laws. If the government does not act, however, if it does allow our copyright laws to stagnate, we might find them becoming not just nonsensical in the new digital era, but worse—irrelevant. Copyright is much too important for us to allow that to happen.
I move the second reading amendment circulated in my name, which draws attention to the government's failure to respond to the recommendations of the Australian Law Reform Commission's report on copyright in the digital economy and as well, regrettably, the government's failure to fully respond to the recommendations of the House Standing Committee on Infrastructure and Communication's inquiry into IT pricing directed at encouraging legitimate content downloads. The second reading amendment also calls on the government to do so—that is, to fully respond to both those sets of recommendations by 17 December 2015. I commend the bill to the House.
Is the amendment seconded?
I second the amendment.
It is good to speak on this very important area of copyright law and copyright reform. I think it is important at the outset to reflect on why this legislation is necessary. The reason that it is necessary is because of changes in technology. The growth of the internet has been massively beneficial to society in so many ways—education, health care, entertainment, news, you name it. But, as in all things, there has been a downside. One of the difficulties that has arisen in the internet age is it has made it very relatively simple to commit acts of piracy. There was probably always there a human capacity to engage in piracy. It is just that online technology makes it so much easier. As a consequence of that, the amount of piracy has grown quite substantially to the point where it is a very serious threat to legitimate businesses.
The other issue with the internet and distribution online is not only is it relatively simple for consumers to engage in acts of piracy but it is also relatively difficult to track down the source of those acts of piracy in the geographical sense. It is not like the old days where a pirate would be perhaps clutching a pirated VHS tape at the local store. This is about content coming from all around the world and from many different locations. As a consequence, it has been a very difficult problem for government to address and to seek to minimise the impact of piracy.
There are two categories of business that are negatively affected by piracy. Both of those categories of business deserve the right to be protected against unlawful piracy. The first is producers. We hear a lot about the Australian production industry. We have a proud tradition in this nation of punching above our weight in video production, in film, in television and so on. The capacity for people to make use of that programming without paying for it obviously has a significant negative impact on those local producers and protecting their rights is important.
There is also another category of businesses that do not actually produce the content but buy the right to distribute it. Their rights are equally important. That content is not always produced in Australia but the rights to distribute it are obtained in Australia. It is very important that government acts sensibly to minimise the piracy wherever it can.
It is worth thinking about why this space has changed so dramatically. If you think through the different modes of video distribution and how they have changed in recent years, it provides a pretty clear insight into why reform in this area has been needed. Focusing on video distribution, there is a wide range of traditional formats and some new ones. Perhaps the oldest of all is theatrical release. In the old world, the first distribution of a film would be in a theatre. There was no capacity in a practical sense for that film to be accessed or distributed prior to the theatrical release and, consequently, there was not a major problem. Now of course we have a situation where people can attend a theatrical releases in other countries, they can make a copy of that movie and then they can distribute it online on the same day. That may be months ahead of when the theatrical release is due to be distributed in Australia.
The same applies to free-to air-television. I am sure you will fondly remember the days of when the television programs would be seen in Australia. We would all wait for the Australian release of the program often some months after it was broadcast in the US and other countries. There was no suggestion that anyone would be able to access that program beforehand. But now you can because as soon as it is released in other countries, particularly the United States, those online copies are often available.
The same applies to videos and DVDs. DVDs were copied and continue to be copied. There continues to be copyright infringement in physical formats but, again, the complexity of actually going and getting a copied DVD, of selling it and distributing is a much higher order than it is of simply putting something online. And, as a consequence, online distribution is so much greater.
We now have an emerging set of legitimate online distributers of video. Over the past seven or eight years, as internet speeds have been sufficient to distribute video online, the industry has been principally based around what is called 'ad-supported distribution'. Also known as 'catch-up TV', it is where a program, after distribution or broadcast, is shown online and advertising is sold against that. The problem for content owners is that once a program has been broadcast on free-to-air television there are often free copies being distributed online without ads in them. That is a very compelling proposition for consumers—watch something without ads, or watch it with ads. Unfortunately, many consumers are choosing to watch those pirated copies. The same applies to transaction video on demand and increasingly subscription video on demand, where we are seeing the rise of services like Stan, Netflix and others. What copyright owners deserve is for fair rules of play to be imposed across the system so that people's intellectual property is protected.
In a moment I will come to the specific provisions of this bill, which will go a long way to solving this significant problem, but I also want to touch on another issue in the area of online copyright. It concerns the use of the facilitation of copyright infringement through the distribution of internet protocol boxes, or IP boxes, as they are known. This is an important issue for a number of pay TV broadcasters, some of which are very important in my community, in the Chinese language community, in the Arabic-speaking community and in a range of other communities as well.
We face a situation today where in some retail stores in Sydney it is possible to buy an IP box which is effectively sold on the promise that it will enable you to access a range of copyright-infringing material. You buy the box, and it is configured in such a way that it accesses content which is legitimately pay TV content but which is being sourced unlawfully from another jurisdiction and provided at no cost to the consumer. Those retailers and distributors are effectively facilitating the breach of copyright.
The provisions in the bill that we are discussing today go right back to the source of the infringing material, right back to those unlawful channels, unlawful sites and so on. It is also important to reflect on entities that are contributing to online infringement through the sale of IP boxes which are specifically designed to encourage copyright infringement. Companies like TVB, World Media and others face this issue every day, and it is a very important one.
This legislation is going to be of enormous help in reducing the incidence of copyright infringement, and it takes a very practical approach. It is a very complex area—there are people all around the world involved in copyright infringement. It is incumbent on legislators to be practical and to think about how legislation such as this will work in the real world. This will be effective, because this enables an entity who feels that its copyright has been breached to seek an order requiring an ISP to effectively block access to that infringing material. But most of the time that infringing material will be sourced from overseas.
In a practical sense, it is very difficult for Australian law to go after a copyright-infringing service that might be based in Kazakhstan—or in any part of the world, for that matter. But what we can do is require ISPs who are based in Australia and subject to our laws to act to minimise the likelihood of copyright-infringing activities occurring. That basically requires the ISPs to block access to sites or other online locations that are engaging in infringing activity. The ISPs themselves have done nothing wrong, and importantly this legislation makes that clear. There is no suggestion that the ISPs themselves are engaged in copyright-infringing material. But going to the source and blocking the relevant service will go a long way to reducing the incidence of copyright infringement. So it is a very practical solution.
It is also important that the legislation provides that, for an order to be issued by the court requiring an ISP to take down material, the primary purpose of the online location must be copyright infringement. What that means is that if a site is engaged in legitimate activity, such as Netflix, based in the US, the fact that an individual in Australia might be accessing that site in a manner which infringes copyright does not mean in and of itself that Netflix is engaged in activity which should be blocked, and that is a really important distinction.
This legislation basically goes after entities whose business model is to infringe copyright. It is extremely important that this occurs. Just as in any other industry people have a right to be protected against theft of their physical or intellectual property, so should people involved in our creative industries, who employ so many Australians and do so much good work.
The good news is that the injunction powers that are proposed by this law have been effective in the UK, in Ireland, in Singapore and in other jurisdictions, and again the capacity for the copyright owner to simply seek for the offending site to be blocked by the ISP is the most practical possible way of addressing this problem. I concur with others in this debate in saying that I think the way that this will play out is that in the early days you will probably see a number of court actions initiated. You will see some court orders issued for take-down notices for infringing material. But then what will happen, logically, over time, is that ISPs and content providers will work together in a sensible way. No doubt they will circumvent much of that court formality and work together in a constructive fashion to take down offending material, and that is as it should be.
These are very sensible steps. They are practical. They are not going to catch lawful activities. Importantly, they make it clear that ISPs themselves are not engaged in unlawful activity, but they make use of the technical capacity of ISPs to go directly to the source of the problem and seek to solve it. This is a complex area. This is an area of law that will continue to evolve, but these are important provisions, and I strongly commend them to the House.
Piracy is a breach of copyright. It is the unauthorised copying, distribution or use of copyright material, and Australians do it more than almost anyone in the world. Game of Thrones is the most pirated television show in history, and last year Australians illegally downloaded it more than any other country in the world. According to data gathered by file-sharing site monitor TorrentFreak, in 2014 we accounted for 11.6 per cent of illegal downloads of Game of Thrones. In 2013, we also topped the list for pirating the Breaking Bad finale. Eighteen per cent of illegal downloads of that show were right here in Australia. Why is this happening? There are lots of reasons, but the main reason is that, if Australians cannot get access to the content that they want to watch or listen to and they cannot get access to it cheaply and quickly, they will find another way, either by using a VPN to access overseas content or by peer-to-peer file sharing or accessing overseas websites like The Pirate Bay.
The Copyright Amendment (Online Infringement) Bill 2015 establishes a legal process to block access to websites like this. Under this legislation, copyright owners will be able to apply to the Federal Court, requiring internet service providers to block access to overseas websites, like The Pirate Bay, which have the primary purpose of infringing copyright or facilitating the infringement of copyright. This is not unique. It is not new. Thirty-nine countries around the world have legislation that is similar to this.
This bill has been subject to an inquiry by the Senate Legal and Constitutional Affairs Legislation Committee. It received 49 submissions, and most of those submissions were broadly supportive of the bill, but some raise concerns about its reach as well as the costs associated with it and its effectiveness.
In relation to reach, there are concerns that were raised in submissions—and are reflected in the committee's report—about whether VPNs might be caught up by this scheme. The minister has raised the same concerns himself. I am glad that the committee recommended changes to the explanatory memorandum to clarify the status of VPNs, but they do not appear in the amendments to the explanatory memorandum that the government has circulated in relation to this bill. I ask the government to make a change to the explanatory memorandum to ensure that this occurs and to ensure that the explanatory memorandum is amended to reflect the concerns raised by the committee.
ISPs have also raised concerns about costs and indemnity issues. Once again, the committee recommended changes here to the explanatory memorandum, and once again I do not think the government's changes to the explanatory memorandum sufficiently address the concerns of ISPs or the committee. I also do not think they reflect the position set out in the government's own discussion paper, which said:
Rights holders would be required to meet any reasonable costs …
So I ask the minister to have another look at this.
The amendments that the government has circulated also do not include the two-year review of this legislation that the committee recommended. So, when the minister speaks in reply later in this debate, I ask him to make a commitment to do this as well.
Piracy is illegal. If this legislation helps to reduce piracy then that is a good thing. But there is still good reason to be sceptical about how effective it might be. There is lots of evidence that site-blocking legislation can have an impact, but sometimes that impact is temporary. Sites that have been blocked often disappear for a while and then reappear down the track under a different domain name or web address. The Minister for Communications has made this point himself. On 10 December 2014, he said:
If you are asking me is it possible for, say, Pirate Bay to then move to another IP address or another URL for that matter, of course that is true …
We have seen evidence overseas that that is what happens from time to time. Last month, in Sweden, The Pirate Bay's official domain name was seized by the court, but, as The Independent newspaper reported on 19 May this year, the people behind The Pirate Bay have already said that the site is likely to be able to get back up and running at an alternative address.
What this shows is that, to be effective in combating piracy, you have to do a lot more than just pass laws like this. A lot of the responsibility for that rests with industry. A survey conducted by iview for Choice last year found that 50 per cent of people downloading illegal content said that their main reason for pirating was price, and 41 per cent said it was that they wanted specific content sooner than available in Australia.
The take-up of services like Spotify and Netflix demonstrates that when people can get access to content cheaply and easily, they take it up. Last year, research conducted by Spotify said that there was a 20 per cent decline in music piracy over a 12-month period. Netflix has had a similar impact. In April, Netflix's chief content officer Ted Sarandos said:
The real great news is, in the piracy capitals of the world, Netflix is winning. We're pushing down piracy in those markets by getting the access.
Netflix is expected to sign up one million Australian customers by the end of the year. About six million Australians have used Spotify.
The take-up of services like Netflix, Spotify, Stan, Presto, iTunes and Pandora show that Australians want content and they are prepared to pay for it if it is cheap, quick and easy to get. All of these services are great examples of industry responding to the needs and the demands of modern day consumers. But there is still more to do. On that point, it is a mistake to assume that is just teenagers illegally downloading shows like Game of Thrones or Breaking Bad. People of all ages do it.
Research commissioned by the Australasian Performing Rights Association in 2013 found that 44 per cent of people aged 18 to 30 engage in piracy, 25 per cent of people aged 30 to 49 do it and so do 11 per cent of Australians aged 50 to 69.
Really!
Yes, it's true. Interestingly, the research also indicates that the higher your income, the more likely you are to illegally download TV shows, music and movies. According to the APRA research, a household earning less than $40,000 a year is less likely to engage in illegal downloading than a household earning more than $100,000 a year.
In his second reading speech, the Minister for Communications also mentioned an education notice scheme that is being developed by ISPs and copyright holders that will warn people who have allegedly pirated copyright material and give them information about legitimate alternatives. This is now being developed into a code of practice and is currently being considered by ACMA. The good news is that it does not look as bad as some people feared it would.
The government discussion paper that was released in July last year canvassed the US copyright alert system, which involved ISPs slowing down the internet speed of their customers or cutting off their access to the internet altogether. A similar system operates in South Korea. There have been people in this government and in industry who have been keen for Australia to adopt this approach. I am glad that we are not.
The bad news is that it is still unclear who will pay for the cost of operating this scheme, how much rights' holders will pay to operate it, how much ISPs will pay and how much this will add to the internet bills of Australians who do not illegally download.
I also want to draw the House's attention to the failure of this government to do anything to address the recommendations of this report, Copyright and the digital economy: final report by the Australian Law Reform Commission, dated November 2013 and released by the Attorney-General, I think, in February 2014—almost a year and half ago. It is a very important report. It includes, all up, 30 recommendations. The bill that we are debating here tonight is an amendment to the Copyright Act, and it does not respond to any of the recommendations in this report. The key recommendation in the ALRC report is not this—it is not about site blocking; it is the creation of a fair use exemption. The Law Reform Commission argues that this would:
… make Australia a more attractive market for technology investment and innovation.
When I was in Silicon Valley last year, I heard much the same thing from my conversations with people at Google, Amazon and Yahoo. All of them told me that laws like this, fair use exemptions to copyright legislation, helped to facilitate the development of things like search engines and cloud computing.
What are we doing to implement these reforms here? Nothing. The report has been gathering dust now for almost 18 months. And the only change that this government has proposed to copyright law is this legislation that we are debating tonight.
It is the same with this report, At what cost? IT pricing and the Australia tax, a report of the House of Representatives Standing Committee on Infrastructure and Communications, dated July 2013. This report made another problem clear—that is, that we pay more for IT products than people do in many other countries around the world. Often, we pay 50 to 100 per cent more that people pay overseas. That includes everything from music to games, software and hardware. Incredibly, it is cheaper to buy a song from an Australian artist on the US iTunes store than the Australian equivalent.
The report makes a lot of recommendations and, once again, the government has done nothing about them. That is why the opposition are moving a second reading amendment, calling on the government to respond to both of these reports by 17 September. I encourage the government to support this proposal. If the government does not support this then it will show very clearly to the Australian people that the government is not serious about reform in this area.
We do need to reduce piracy. We do need to protect copyright. If this legislation helps to reduce piracy then that is a good thing. But we need to be careful not to overestimate how effective this legislation might be. When I was a kid, you learnt about piracy at the start of every video that you got from the video store. It was the bit that you could not fast-forward through. It is a very different world today.
The internet allows us to get almost anything we want at the click of a button. When you have to wait longer than people in other countries or pay more to watch what you want to watch or listen to your favourite music or play your favourite game, people understandably get angry and frustrated, and they look for another way to get what they want. Legislation like this will not stop that; it will not stop that in its entirety. Content also has to be cheap, quick and easy to get. And that is a job for business not for this parliament.
Australia possesses a valuable creative sector. In my electorate of Forrest, there are a number of creative industries and organisations. One of those is the Vue Group. I was just at the ASTRA event talking to those who might be interested in what the Vue Group are doing. The Vue Group is a creative studio based in Bunbury in my electorate of Forrest in the south-west of Western Australia. Recently it was a finalist in the 2014 WA Industry and Export Awards in the categories of small business export, creative industries export and regional exporter. The development of this high-tech industry in Bunbury will, over time, employ more than 200 people locally for their biggest projects. It is set to become WA's biggest film company looking to access the demand for animation and CGI films in China. This is exactly the sort of business which could be impacted by the issues we are discussing in this bill, particularly online copyright infringement. The creative sector is certainly in the firing line of this one.
As with the Vue Group, we know that in Australia we certainly have a very serious problem, one of the worst in the developed world. Looking at the wonderful work the Vue Group do, in our small part of the world they already have contracts worth $160 million to coproduce several animated features with the Chinese staff at Shanghai Hippo Animation and there are plans to expand this, assuming a range of other opportunities.
Another creative industry in my part of the world is a group called Sonic Lolly, founded in 2010. It is a music and sound creation, production, publishing and strategy type of company. It operates out of world-class recording facilities in, of all places, Margaret River in Western Australia. They have an international target market, as well as the local, regional and national industries. As we know, there is a great demand for quality recording, for production, from music business strategy and for artist development, all of the things that are happening in a similar way through Sonic Lolly and other businesses.
The South West Development Commission looked at the creative industries in the south-west and a report was done by SGS Economics and Planning, looking at the 2011 census. There were 1,095 employees working in the creative economy in the south-west at that time and the turnover was around $306 million with a gross regional product of $148 million and exports of $70 million. That is just in my part of the world and it gives you some idea of the creative industries in Australia that are most affected by copyright infringement.
Additional messages in the report tell us that this is going to be an emerging industry. The south-west region hosts more than one tenth of the state-wide specialists employed in film, in television and in radio and seven per cent of the state-wide employment in publishing. This area is certainly impacted by the issue of copyright infringement. We have so many high-performing creative industries—film, television, radio, publishing, architecture, design, visual arts, music and performing arts. Growth is at 3.6 per cent and each creative sector worker in the south-west basically adds more value—$136,000 a year—than his or her counterpart in other locations, including Perth, and even in other world renowned international creative locations. They are doing a great job.
This particular sector will be a focus of the regional economy in the future. That is why this type of legislation is particularly important. Yes, it may not be all that needs doing in this place over time but this bill introduces a key reform that will reduce online copyright infringement because of the specific concerns raised by copyright owners. I am not surprised when you look at the reasons and the figures behind that. Copyright protection provides an essential mechanism for ensuring the viability and the success of creative industries, those I spoke about at the beginning of my speech, just a snapshot of what is currently happening and will happen in the future not just in my part of Australia but right around Australia. I am particularly proud of what those businesses do and the emerging sector that is the creative sector.
We need to keep incentivising and rewarding such creators like the people in south-west Western Australia. Where online copyright infringement happens on a large scale, copyright owners need an efficient mechanism to disrupt the business models of online locations operated outside Australia which distribute infringing copyright material to Australian consumers. There are significant difficulties in taking direct enforcement action against those types of entities. Online copyright infringement poses a significant threat to incentives and rewards to the creative sector in Australia due to the ease by which copyright material can be copied, can be shared—and it is almost viral—through digital means and without any authorisation. When you consider that Australia's copyright industries employ 900,000 people, at an economic value of more than $90 billion and $7 billion in exports around this country—and, of course, digitisation means that they are particularly susceptible to online copyright infringement—you realise that this really impacts directly on the Australian economy. That is why we have taken this so seriously.
But it can hurt consumers as well. Consumers accessing material unlawfully are certainly not covered by consumer protection laws and may be exposing themselves to the risk of fraud and other forms of cybercrime—without a question. As you know, Mr Deputy Speaker, I do a lot of work in this space. I do presentations in the community for school groups, parents, businesses and broader community groups. I see the harm that they come to in this space all of the time. The absolute focus of what I do is on children and the education of children around what they do online. Both the Attorney-General and the Minister for Communications noted that children in this area of online piracy and online copyright may be exposed to material that is not age appropriate. I can certainly say that that is exactly what is happening, whether in my community or in others around Australia. Children are, through this medium, being exposed to material that is certainly not appropriate for their age, facilitated by online infringement.
We cannot expect that any single measure is likely to eliminate online copyright infringement, but we have to take one step at a time, and this legislation is an important step. As I said, there is no easy solution and a range of measures are required to reduce piracy. We want for people to be able to continue to enjoy content in the digital environment, but rights holders need to know that their content can be accessed easily and at a reasonable price and that internet service providers will take reasonable steps to ensure that their systems are not used to infringe copyright. We need consumers who are prepared to do the right thing and access that content lawfully so that our creative industries can get the benefit of what they produce—of their imagination, of their investment, of their creativity and, often, their heart and soul, which they put into the work that they do. We need a legal framework that facilitates that industry cooperation so that we have flexible but effective measures to help combat online piracy.
Overseas, we have seen other countries try to address this. This is not a simple issue. The US has a Center for Copyright Information. It is a industry body with a voluntary industry agreement called the Copyright Alert System. The UK has a similar approach through Creative Content UK and New Zealand has a statutory graduated response scheme. It just shows that it is such a complex issue.
There are 3.4 billion people plus in the world using the internet. At least 1.3 billion people use Facebook. There are tens of thousands of websites, many with absolutely no encryption and no protection of any sort. That is the environment people are in. The 3.4 billion people using the internet often have no idea what they are exposing themselves or their systems to when they engage in this space.
As to some of the reasons that we really do need to be concerned about online copyright infringement, we have consumers accessing material unlawfully, as I said. They are not covered by consumer protection laws. I am sure this is something that has not really occurred to them at all. I look at the issue of online safety and the amount of time that people are spending online, and they have an increased exposure to this problem, certainly when it comes to online piracy. If you talk to a child about the time they spend online, frequently they do so with absolutely no barriers to what they can access or where. It might be from 20 minutes to a couple of hours and on weekends unlimited, so they have access to everything online. The issue that really affects me is the fact that children have access to information and to sites that are not age appropriate.
The Senate Legal and Constitutional Affairs Legislation Committee reported and made recommendations. Three amendments, one to the bill and two to the explanatory memorandum, will implement the recommendations of the committee and ensure that the bill better achieves its objectives by providing a framework—this is the important part—that is workable, which it needs to be. It needs to be effective and flexible and very easy to understand. There is only one proposed amendment to the bill. This amendment provides that, in considering whether to grant an injunction, the Federal Court may take into account the list of specified matters rather than being required to take these matters into account, which enables the Federal Court to exercise discretion as to what matters to take into account as well as the appropriate weight to place on these matters. Again, there needs to be a practical approach, consistent with that normally taken by a court in assessing whether to grant an injunction. There are two proposed amendments to the explanatory memorandum. The first relates to appropriate orders that the Federal Court may make in granting the injunction, consistent with the Federal Court of Australia Act 1976, and a supplementary explanatory memorandum providing a further example that the court could order that parties set up a landing page where subscribers will be diverted to if they try to access a disabled online location. Such a direction would have merit since subscribers will know what is going on without needing to contact their CSP to ask questions. The second amendment to the explanatory memorandum is to provide further clarification on costs and liabilities of CSPs in carrying out an order. This is the position under case law, and the bill is certainly not intended to change that.
I will go back to where I started. There are so many creative industries in Australia with a great future. We need to make sure that they get the benefit of the work they do, of their creative capacity and of their business model. This is one part of that. I commend the bill to the House.
I am pleased to have the opportunity to speak on the Copyright Amendment (Online Infringement) Bill 2015 and to support the amendment circulated by the Shadow Attorney-General. In particular, I think that the substance of the amendment that has been moved goes to the heart of many of the submissions that were made to the Senate inquiry into the bill and addresses factors that contribute to behaviour and breaches of copyright in the first place that are useful to discuss in this context. Make no mistake, this is a vexed area. It is vexed in terms of not only a legal perspective but also a policy perspective, there is no question about that.
In making some observations on the bill, I want to touch on its rationale, on Labor's approach, on the importance of protecting consumers, on some concerns that my constituents have raised with me and on some of the misconstruing surrounding this bill. I also want to redress what I might describe as push factors for online piracy in the first place. Last night when I was giving some comments on the report by the House of Representatives Standing Committee on Infrastructure and Communications into section 313 of the Telecommunications Act, I foreshadowed that one thing that often seems to be missing from debates around these areas of site blocking and copyright is a focus on consumers. I think it is really important to bring it back precisely to that point.
One article that has stuck in my mind for a couple of years was by Zack Whittaker from 10 January 2011. I believe it has been published on ZDNet since. It is headed 'Why young people pirate (pssst: it's not just about money)'. It asks very valid questions that go to the whole issue of why people and, in particular, young people do pirate. This was written from a UK perspective, but I think the principles remain the same. This article asked the questions: is it just a lack of available regional content between the US and Europe, or is it just all about the money? He makes some statements that I think are valid more than four years later in the context of this debate. It would be a lie to say that money was not a significant factor for young people and students alike. But to collate and understand why young people pirate boils down to one easy, summarising statement: the legal options are not as readily available, simple enough or consistent enough to access. It really is as simple as that.
It is important to look at this in the context of Australia today. One aspect that is useful in this regard is a survey that was published by Choice in December last year. Their piracy survey shows that most pirates are actually willing to pay for content. It notes that one-third of Australians have illegally accessed online content. Some of the key survey findings are that 50 per cent of pirates said that their main reason for pirating was price and 41 per cent said it was because they wanted specific content sooner than available in Australia. For a staggering 91 per cent of those pirating, their rationale or main reason is either price or availability. I am not proposing, and I think it would be absurd to propose, that the law should and can address these areas. But the fact that the Choice survey shows most consumers—55 per cent—try to use legal sources first before searching out pirated copies of content does indicate that there is an issue in the market here.
On that point, I believe that it is important for the government to pick up the recommendations made in the report from July 2013 At what cost? IT pricing and the Australia tax, which had a very sensible list of recommendations that are worth exploring. I will just go to one of them, recommendation No. 6. It does not propose a legislative change, but it does propose that the government investigate options to educate Australian consumers and businesses on matters such as the extent to which they may circumvent geoblocking mechanisms in order to access cheaper legitimate goods, the tools and techniques which they may use to do so and the way in which their rights under the Australian Consumer Law may be affected should they choose to do so.
I want to consider some of the submissions that were made to the Senate committee. There were 49 submissions in all. When you look at the list of submitters, these are all very knowledgeable groups in their own areas. I want to take a sample because, although some of these are contrary to one another, they do illustrate the point that I have been making that access to content in an affordable and timely manner is a key issue in circumventing breaches. Like many members, I received a large number of emails which were accessed through the Choice website. I want to acknowledge the constituents who went to the trouble of looking this up and sending me an email on this, often with additional comments. I have here a request to vote against this bill, but there is also a statement: 'If you won't vote against the bill, then I ask you to make sure that it won't accidentally captured legitimate websites including VPNs.'
It urges me to have a look at the Choice submission that was made to the inquiry, and I want those constituents to know that I have duly done that. It was very useful because, as pointed out in the introduction to its submission, Choice believes that the bill is unlikely to reduce access to sites facilitating online infringement and even less likely to reduce the rates of online infringement. Even if you disagree with that point, they then make a point that I think is quite valid, and I go back to the 2011 article that I previously quoted: Choice's research has consistently shown that consumers in Australia pay more for identical digital products than consumers in comparable markets such as the USA or United Kingdom. Providing Australians with better access to digital content at a comparatively reasonable price will give consumers a greater incentive and opportunity to access content legitimately. Indeed, it goes to the very issue of the IT pricing inquiry that I mentioned. We think it is unfortunate that this approach—that is, this bill—favours a heavy-handed legislative approach ahead of market based reforms such as those recommended by the House of Representatives inquiry into IT pricing and also the recent final report of the federal government's competition policy review. Again, I make the point that timely and affordable content is paramount in this case.
A different submission is that of Screen Producers Australia. I acknowledge Screen Producers Australia, who have been hosting a number of events in Parliament House over the past few days. As is the case with the member for Melbourne Ports and the member for Moreton, the screen is one of my great loves. I was previously the chair of Screen New South Wales. It was a position not only that I enjoyed immensely but that taught me a great deal about the way our creative industries support people in my electorate—an electorate you would not normally consider to be one that would benefit from these industries—everything from the catering to the logistics and to the minds of the people creating content that certainly should be protected. So, I want to acknowledge Screen Producers Australia. Their submission notes:
As representatives of intellectual property creators, Screen Producers Australia strongly supports initiatives that will reduce the incidence of online copyright infringement and we offer in principle support to the proposed amendments in this Bill.
Screen Producers Australia believes that these amendments, along with a Copyright Notice Scheme, will form an important part of a holistic strategy, one that includes public education, promotion of legal alternatives and a pathway to stronger enforcement. It is the view of many rights holder groups that similar site blocking measures have been adopted overseas and have had a positive impact.
Indeed, I take particular note of their point about it being a holistic strategy. Not only legislative means such as this but also other means of ensuring that Australians have access to timely and affordable content will go a long way towards that.
Screen Producers Australia refers some of its substantive comments to the Australian Copyright Council, a very reputable organisation founded in 1968. Whilst they say that they support the government's strategy to address online copyright infringement, they wanted to raise a number of operational features of the bill. One of them that stands out is the definition of online location. They point out that infringing websites can indeed pop up at different domain names, and some of the other submissions I have looked at raised this very issue as well. They point out that the term 'online location' may be broad enough for an injunction to cover replicas of the same infringing website that pop up at different domains. And I think they make a very valid point, that settling this is crucial for the legislation to be effective. So, how this is administered in practice will certainly be extremely important.
A submission like that of Electronic Frontier Foundation takes an intensely different view. But, again, they do point out the importance of giving consumers timely and comparatively affordable access to content:
EFF believes that censoring content from the Internet through blocking or filtering is never the best approach to take in managing illegal behaviour online, and that it is always much better to address such behaviour at its source.
I believe that here they are going to the issue of behaviour: why are people pirating? It goes back to those very issues I mentioned.
In the time left to me I want to point out that the government has not yet responded to the ALRC report. In July last year the Attorney-General and the Minister for Communications released a discussion paper about online copyright infringement, which included a number of proposals. The bill we are debating takes up the second proposal, which looks at introducing mechanisms for blocking infringing sites. My understanding from the research I have seen is that Australia, unfortunately, has a high level of piracy by international standards, and it does have an economic impact, it does have an impact on jobs and it does have an impact on the sector. And the effects flow on to many other areas of the sector. We on this side of the House support reasonable measures to discourage piracy. We believe action is needed to reduce current levels of online piracy and that the enforcement of copyright law is vital to our creative industries.
So, we do support this bill, which, as the shadow Attorney-General has pointed out, is modest. It is a common-sense measure. It is intended to disrupt foreign websites operating as havens for piracy and to discourage copyright infringement by Australian consumers. To quote the shadow minister for communications and the shadow Attorney-General last year:
It is clear that action is needed both to deter piracy, and to encourage access to legitimate content.
We made it clear that there are concerns regarding the effectiveness of site blocking when dealing with online piracy, and we noted that pirated content is likely to reappear as quickly as it can be taken down.
As I have said, this bill will certainly not completely solve the problem of piracy in Australia, but it is appropriate to take action against websites that flagrantly and intentionally flout the copyright law. This bill is directed at foreign websites whose primary purpose is to infringe copyright or facilitate the infringement of copyright. It is hoped that disrupting this kind of website will discourage at least some copyright infringement in Australia.
I note that the shadow Attorney-General in his remarks this evening made comments on what the bill does not do, and I think it is important to highlight where this bill draws the line. This bill does not provide for a sort of internet filter. It provides a judicial remedy on a case-by-case basis for conduct that flouts existing Australian law. The requirements of the bill are strict, and we can expect Federal Court judges to exercise the site-blocking power cautiously and with restraint. And I am conscious, as I indicated, because of a number of constituents who contacted me—and according to that Choice website over 5,000 such emails were sent to various members of parliament around Australia—that some members of the community and my own constituency are concerned that the bill might allow the blocking of virtual private networks, or VPNs. We have made sure that this is not the case. Our senators on the Senate committee investigated this matter and are satisfied that the bill's terms would not extend to blocking VPNusage. However, we have asked the government—and I think it is a reasonable request and my understanding from the Attorney-General is that it has been agreed to—to put this matter beyond doubt by amending the explanatory memorandum to clarify this.
I think it is important that, while we do have this bill, we need to ensure that timely and comparatively affordable content is made available to all Australians.
I, too, rise to speak on the Copyright Amendment (Online Infringement) Bill 2015. I have big shoes to fill, after that great speech from the member for Greenway. The purpose of this bill is to address the ever-increasing problem of online piracy in Australia. As mentioned by the member for Greenway, by international standards Australia's level of online piracy is, sadly, very high. In fact, according to the Choice survey, about one in three Australians has accessed data. If I think of one in three people in my electorate, say, my wife, me and let's say any other person in the chamber from Moreton, one of us three will have accessed data and I know it is not my wife or me.
But, obviously, one in three Australians is doing that, according to the Choice survey. I do not know whether that is because of our larrikin spirit or our convict links or, as the member for Greenway touched on, the fact that Australians have been shafted for such a long time when it comes to price and the timing of the shows that they want to watch. Nevertheless, irrespective of those reasons, piracy is a real threat to our creative industries. It is important that we look after our authors, directors and musicians by ensuring that they receive a fair return for their artistic endeavours. I note that this matter has been canvassed before by the member for Chifley in a previous inquiry. He raised those concerns about price and timing. I will not canvass that in this speech. Instead, I will just address the copyright legislation that is before the chamber.
However, as an author and someone who struggles with creative endeavours, I think it is important that we do look after these industries. These industries are still reeling, particularly in terms of artistic endeavours, by the recent and bizarre decision by the Attorney-General on budget night to strip $105 million from the independent, well-respected historically creative and lean Australia Council and move it into his office. I will address that matter in other forums, but I do want to focus particularly on the protection of artistic endeavours contained in this copyright amendment bill.
Obviously, piracy damages a vulnerable industry and impacts on precious Australian jobs. I have been involved in that creative process outside of being a politician both as a musician and as an author—a very ordinary musician and an author with limited financial success. Nevertheless, back in my teachers college days, I was in a band that people can track down. I had a fantastic songwriter, John Carozza, who went on to become an artist. In fact, he has a show commencing this Friday at Gallery 61, Musk Avenue, Kelvin Grove. I hope to get along to that.
What time?
From 6 pm to 8 pm—thank you, Member for Melbourne Ports. I know you will go along because of your support for artistic endeavours. There is a great artist, a musician, now a painter, finding it hard to extract an income from his artistic endeavours. As an author I know how difficult that is as well. I understand the difficulties of emerging artists in particular in trying to develop a sustainable income. These are very difficult industries, whether it be cinema, writing, music or whatever, to get a foothold in. And in this modern world of illegal downloading it is even harder to make a buck. It would be a sad day indeed if the only way for an up-and-coming rock star—U2, Midnight Oil or the like—to make a dollar would be to actually busk and perform live rather than sell their product not just to Australia but to the world, something that Australian musicians, cinematographers and theatre producers have done so well.
The bill will not solve this difficult problem but it will be a small common-sense measure that will disrupt the foreign websites which are acting as havens for piracy and may discourage those one in three Australian consumers from participating in this practice. It is a practice that sabotages the artistic endeavours of the very artists we admire and support. Obviously, we do not download the material from artists whom we do not admire, respect and support. So it is a conundrum. As the member for Greenway touched on, if people had the opportunity, they would be prepared to pay something that is reasonable. But we come down to those problems of price and timing.
I stress up-front for those people who are interested and I am talking particularly to one of my constituents Nerdy Nigel—that is his Twitter name—that this bill does not provide an internet filter of any kind. It provides—and this is important in a week where we are celebrating the 800th Anniversary of the Magna Carta—a judicial remedy. A judge will decide whether the conduct involved breaches our Australian law and each case will be decided on its merits—something that all Australians would obviously be supportive of. This bill will provide for the owner of a copyright to apply for an injunction to require a carriage service provider to take reasonable steps to disable access to an online location.
An injunction, as any lawyer would know, is a serious remedy to seek. So the bill provides that, before a court can grant an injunction, the court must be satisfied that the primary purpose of the website is to infringe copyright or to facilitate the infringement of copyright. I repeat again: the carriage service provider, the CSP, will be impacted on only if the court is satisfied that the primary purpose is to infringe copyright or to facilitate the infringement of copyright.
The primary purpose test is built into the bill and is a high threshold for the applicant to meet and that is a necessary protection for CSPs so that they are not targeted if their main purpose is actually a legitimate purpose. Some examples of legitimate purposes include an art gallery website, which is operated from another country, or even the iTunes store, a site where I seem to be investing most of my disposable income. I have moved on from cassettes—that was not so good—CDs were also not a wise decision. I am now investing in iTunes.
It can all go on plastic!
I never moved into records, Member for Melbourne Ports. Perhaps that would have been a wise financial decision, but I would not change it at all. Music is such an important part of my life. In both of these examples the CSP is legitimately providing content for the purpose of selling that content and benefiting the holder of the copyright. There may, however, be occasions where the photograph on the art gallery website is not properly authorised, or iTunes is not licensed to distribute a particular item in Australia—something which I occasionally come across when tracking down some of the more obscure bands that I like to listen to.
No-one would seriously contend that, in those particular cases, websites like iTunes should be disabled. However, this legislation is designed to disrupt those websites that are flagrantly acting as conduits to pirated copyright material. It is important that, when such a serious consequence as disabling access to a website is at stake, there should be safeguards in place. The bill provides that before a court can grant an injunction it must consider 11 mandatory factors contained in the legislation: (1) the flagrancy of the infringement of the copyright; (2) whether the website makes available directories, indexes or categories of the means to infringe copyright; (3) whether the owner of the website demonstrates disregard for copyright generally; (4) whether the access to the website has been disabled by orders from any court of another country; (5) whether disabling the access is a proportionate response to the infringement of copyright; (6) the impact on any person or class of persons likely to be affected by the grant of the injunction; (7) whether it is in the public interest to disable access to the online location—an important consideration; (8) whether the owner of the copyright had notified the operator of the online location as required under the legislation; (9) whether any other remedies are available under the Copyright Act; (10) any other matter prescribed by regulations; and (11) any other relevant matter. It is a non-exhaustive list, so the court can consider any other relevant matter. This judicial discretion is another safeguard—and an important one when the remedy sought is as serious as an injunction.
There have been concerns around this bill—in particular, that its provisions would extend to blocking virtual private networks, VPNs. The Senate Legal and Constitutional Affairs Committee has investigated whether that would be the case, and our Labor senators on that committee are satisfied that the provisions of the bill do not extend to the blocking of VPN usage. To eliminate any doubt whatsoever about the blocking of VPNs, Labor has asked that the government amend the explanatory memorandum to clarify this, and I am sure we will hear from the minister directly about this. I hope that the government will attend to that.
We are living in a digital era. As an occasional author, I appreciate how different the publishing world is today from even 10 years ago. At a Labor Party conference not that long ago, I remember arguing with the Hon. Craig Emerson about the parallel importing of books. I genuinely believed the arguments that I had then, but I see now how much Kindles and iPads have taken over the reading experience for people. Now they are completely commonplace on a plane; it is almost rare to see someone holding a paper printed book. We do need to have these arguments, particularly when it comes to supporting Australian endeavours. We are a small country, we are a long way away from Europe and the United States—from anywhere, some might argue—so it is important to support that Australian story wherever we can. I was particularly concerned today to revisit some of these arguments when the entertainment industry visited me to talk about a proposed review—supposedly a red-tape review in terms of a government deregulation agenda—that is going to have a particular challenge for the Australian entertainment industry. Australia's longstanding support for home-grown entertainment and entertainers could be under threat by the Attorney-General's review. It was quietly announced on, I think, 6 January; not even a press release came out about this review. The government is proposing to cut the requirements for taxpayer-funded productions to employ Australian actors and crew. This would completely undermine decades of work that has built up a viable local entertainment industry.
I should explain that the guiding principle for the current arrangements is simple: productions that are funded by Australian taxpayers should create opportunities for Australian actors and crews to work, gain experience and get the breaks they need to succeed here and on the world stage. That is how we are able to produce those great actors. That is a matter that the Attorney-General is advancing that we will discuss later down the track. If we are going to have a legitimate, strong, true Australian story, it is important that we make considered decisions that are in the national interest rather than just letting the market rip. That is not the Australian way at all. As I said, we had a similar argument when it came to publishing a few years back. Being aware of these changes, Labor, when in government, asked the Australian Law Reform Commission to launch an inquiry into copyright law in the digital economy. The resulting report was provided to the current government in November 2013. The government have been sitting on that report for 18 months. They have not responded to the report, let alone taken any steps to implement any of the recommendations made by the Australian Law Reform Commission.
Australia has a vibrant community of artists and creators. You see them everywhere; in fact, I met with a group of them last Friday in my electorate of Moreton at Sherwood: a group of painters and people who sketch, called The Half Dozen Group of Artists, who have been around for 75 years. And they are everywhere—they are what holds this Australian entity together by telling those Australian stories, whether you were fresh off the boat two years ago or whether your family roots go back to Governor Bligh and beyond. Whatever your story is, you tell that Australian story. But this sector needs support. The artistic sector does not need the uncertainty of funding cuts and an Attorney-General who wants arbitrary control of the funding that is left. They do not need the uncertainty of outdated regulations around the new digital era in which they are contributing. This bill is a small measure to help reduce the current levels of online piracy in Australia, and I support the government's endeavours.
The Copyright Amendment (Online Infringement) Bill 2015 relates to producer interests, the interests of the creative industries, that create content like music, video and software. It is important for our nation to provide appropriate support for producers because without them obviously there is no content. As much as it is appropriate to consider producer interests, as representatives we should also consider consumer interests. We should concern ourselves with dealing with the consumer interests when it comes to content that is available to people here in Australia.
It is fair to say that Australian consumers of digital products want fair and timely access to content. It has been described as being more of an issue about service than about price—in other words, the view is that if consumers had more convenient and timely access to digital content then the fact that they would also have to pay for it would not dissuade them from using that lawful way of obtaining content. That is not just my view. That concern has been around for some time in relation to how people can get access to digital content in this country in a fair and timely way.
Last year the research firm Essential Media Communications undertook research that indicated that 79 per cent of Australians are concerned about being charged significantly more than their US counterparts for digital products and 58 per cent were concerned that movies and TV shows were available for legal download in other countries but not in Australia. The Abbott government, though moving on this producer interests bill, has done in my view regrettably little to deal with the legitimate community concerns about the detriments that consumers face in Australia when compared with other nations. Price discrimination in relation to digital content continues to affect Australian households.
A very old friend of mine, Michelle Richards, recently wrote a paper on some of the motivations around piracy in Australia. I think she quite neatly summarised the issues of consumer access to content so I am going to quote her, which will come as a surprise to her. Unfortunately, I have not had time to mention this to her, so I hope she does not mind. She said:
Within the Australian television media landscape, a unique industrial, institutional and legislative framework shapes consumers' viewing habits. Australia's commercial media ownership is one of the highest concentrations in the world … and our isolated geographic location as an English-speaking country amongst Asian markets has meant that English and American media companies and local distributors were free to designate price according to demand without competition … This became commonly known under the term, 'The Australia Tax'—
a term that is commonly used to describe the level of price discrimination that we have in Australia. She went on to say:
There have been recent demands on the ACCC … to look into the unfair pricing practices of these streamers who charge up to 376% more for digital content when compared to overseas markets …
This issue of competition is changing here in Australia. We have seen the introduction of services like Stan, Presto and similar services from pay-TV providers. There is still an issue for Australian consumers in relation to access to digital content such as movies, television, music, software et cetera.
It is fair to say that people are concerned about what this bill and this government are doing to address those consumer concerns, not just the producer concerns. Those are legitimate questions to be asked of this government. That is not to say that we should not be looking at legislative and regulatory mechanisms to combat piracy—of course we should. On our side of the House we agree that action is needed to reduce current levels of online piracy in Australia. We understand the need to make sure that creative industries can remain in a situation where they have viable business models. If you are not fully recovering the revenue you ought to recover in respect of the content that you have developed then that is obviously of great concern to the businesses concerned. We are talking about an important and vibrant creative industry sector in Australia, which is something that people on both sides of this parliament have worked for many years to promote.
I am informed that our nation continues to have a high level of piracy by international standards. Of course that necessarily leads to economic damage and leads to adverse impacts for jobs in content production and creation here in Australia. Accordingly, we continue to say that more should be done for consumers and looking at the pricing issues in respect of the content, but we are prepared to support this bill, which we believe to be a modest and common-sense measure that is intended to disrupt foreign websites operating as havens for piracy and to discourage copyright infringement by Australian consumers. It is true that some websites seem to be set up for the direct egregious purpose of taking away intellectual property or breaching copyright and of harming producer interests. This bill is directed at foreign websites whose primary purpose is to infringe copyright or facilitate the infringement of copyright. It is an important yet balanced bill when it comes to trying to disrupt some of the piracy that is occurring in Australia at the moment.
I am sure other speakers in this debate have spoken about the number of times that, for example, the fourth season premiereof Game of Thrones was downloaded. There were nearly 200,000 separate downloads in Australia. The companies do try to fast-track broadcasts of their television shows that drive demand—they do try to innovate in that regard—but the fact is we continue to have a piracy issue. It appears to be really a product of the issues I have mentioned and also something that has grown up over a long period of time. There is not really the same sort of stigma, notwithstanding the best efforts of some of the creative industry sector, around piracy in Australia that there might be in other places. That is a cultural question as well.
In supporting this legislation I think it is really important that we—and each speaker on this side of the House will—be really clear about what is not affected by the passage of this legislation. In our view this bill does not provide for an Internet filter. It provides a judicial remedy on a case-by-case basis for conduct that flouts existing law. The requirements of the bill are strict and we can expect Federal Court judges to exercise the site-blocking power cautiously and with restraint.
As someone who has herself practised in the Federal Court and who is familiar with applications for injunctions brought in the Federal Court—though not under copyright legislation, I will admit—I will say that one of the great strengths of the Australian judicial system is the great degree of expertise and responsibility exercised by the many learned judges that we are so fortunate to have in the Federal Court of Australia. When we look at striking the balance between the interests of producers and consumers, it is wrong to cast that into some sort of dichotomy. They are not necessarily oppositional interests, because there is obviously a great deal of connection between the interests of a producer and the interests of a consumer. As I said at the very outset, as a consumer of digital content I have an interest in having producers in Australia who actually are able to have a viable business model for creating that content. But I think the Federal Court of Australia is very well placed to strike that balance and to take a measured and appropriate approach when it comes to applications for injunctions in respect of websites whose primary purpose is to flout copyright laws. So, with great respect to the learned judges of the Federal Court, of course our parliament can be very confident that they will exercise their powers with appropriate degrees of restraint and in a manner that is cautious and appropriately strikes the balance between the sometimes competing and sometimes aligned interests of the different parties.
We are conscious that there have been some concerns raised about whether this legislation may block virtual private networks—VPNs as they are referred to. We have worked very hard to seek to ensure that that is not the case. As you know, Deputy Speaker, Labor senators on the Senate Legal and Constitutional Affairs Legislation Committee investigated this specific issue about VPNs and whether this legislation would affect VPNs' usage. Those Labor senators formed the view that the bill's terms would not extend to blocking VPN usage. To assist in ensuring that the legislation is construed that way, we have asked the government to amend the explanatory memorandum appropriately to clarify that that is not the intention of this legislation, and we anticipate that the government will take that action and will appropriately amend the explanatory memorandum. As I said at the outset, it is important, though, for government to think about what some of the drivers of anticompetitive behaviour, or perhaps just the absence of sufficient competition, might be in the market and to find ways to ensure that consumers benefit from the pricing benefits of having greater competition. It is a view that I suspect that everyone in this House would very likely share.
It is also important that the government pursue copyright reform more broadly. As you know, Deputy Speaker, Labor commissioned an inquiry by the Australian Law Reform Commission into copyright law in the digital economy when we were in government. The ALRC provided the incoming Liberal government with its report in November 2013, but disappointingly, 18 months later, the government has still not responded to that report or taken any steps to progress the full suite of reforms proposed by the ALRC. Perhaps the Attorney-General has been a little bit distracted with trying to repeal section 18C of the Racial Discrimination Act, but I would suggest that a better use of the Attorney-General's time would be to consider what actions might be taken to improve and reform copyright law. As you know, there are a lot of views in this country—from producers, consumers and consumer advocacy groups alike—that there is quite a pressing and urgent need for modernisation in respect of copyright law.
This is an important bill. People might say, 'Well, who cares if people are downloading particular shows?' or, 'Is this really the most important issue?' but it is a very important issue not just for the creative industries, not just for the many, many jobs in those industries and not just for the great economic benefits that our country derives from having creative industries here at home but also because this is a broader question of access to arts and culture in our society. The fact is that it is so important that people from all social strata, whatever their background, have access to the rich cultural life that our digital economy is now affording to people and that digital content is now delivering into homes. There is so much choice out there. There is so much access to high and low culture through these digital forms, and it is really important that that not just be reserved for the people with the fastest broadband, the most money or the most technical proficiency. It is important that we deal with these issues of access to culture as a broad issue of concern to the entire Australian community.
I look forward to continued and ongoing discussion about all of the many facets of dealing with this question of access to online content. I mentioned software, movies and music. It was remiss of me not to mention gaming, which is of course a massive industry in itself. We do need to continue to engage. I know that change is fast, and I know that all of these issues are evolving very quickly and that governments of any persuasion can be a little slow to keep up with change, but the challenge for us, if we want to be a modern nation where people participate fully in the cultural life of the nation, is to find ways to improve the way that we grapple with copyright and all of the full suite of issues in respect of digital content.
As I say, we are supporting the bill. We believe it is modest and reasonable. We are fortified in our support by the fact that the Federal Court of Australia will be taking a responsible and cautious approach to dealing with applications under the legislation. We continue to believe that pricing remains an issue, as does access to service. I know that the market is improving, but there is still more to be done here in Australia. On that basis, I appreciate the opportunity to speak to the bill. We, as I say, will always take a critical and moderate approach to supporting any interventions in this area, because it is quite a nuanced and faceted question, but this, we believe, is a moderate and appropriate approach to the issue of combating online piracy.
Australian art, music, literature, film and television are an integral part of our culture and contribute significantly to our economy. These things that we value do not exist without creators. These creators need incentives and rewards for their endeavours, and a robust copyright framework is needed to provide these incentives and rewards.
The advent of the internet has enriched society with the ability to access and share information and ideas to an unprecedented degree. Digital disruption, globalisation, convergence and mass connectivity are upheaving the world around us and fundamentally changing the way we work, interact and are entertained. To get a sense of the pace, think that just 10 years ago the first video was uploaded on YouTube, and Android was a small start-up that Google had just acquired. No-one had a smartphone. Today, 300 hours of video is uploaded onto YouTube every minute. On the one hand, the internet is a platform that innovative businesses have exploited to provide consumers with a great variety and choice of content and ways to access copyright; however, on the other hand, the rapid growth of the internet has brought significant challenges to the protection of copyright due to the ease with which material can be digitally copied and shared at little or no cost.
Overall, in net terms the internet has been a very positive development, with profound social, educational and economic benefits. This is, without any doubt, the most exciting time in human history to be alive, and the internet is a very, very substantial part of that excitement, of that sense of disruption and change and innovation and excitement. But it has also caused some people to treat all content online as something that they are entitled to access for free, regardless of the views or the rights of the owner. This attitude has been extended to creative works produced by artists, actors, directors, producers and writers, who rely on copyright protection to make a living and to fund the production of new works. Unfortunately, those who wish to access infringing-copyright material currently have the means to do so easily and freely.
There is no silver bullet to deal with internet piracy, but the Copyright Amendment (Online Infringement) Bill 2015 provides an important part of the solution to the problem of online copyright infringement. It is vital that copyright owners have an efficient mechanism to disrupt the steady supply of infringing content to Australian internet users from overseas based websites. This bill will provide an enhanced, streamlined mechanism that enables infringing material to be blocked by a carriage service provider—an internet service provider—without the need to establish fault on the part of that provider. Specifically, the bill will introduce a new provision that allows a carriage service provider to disable access to infringing online locations located outside Australia.
The bill contains a number of safeguards to ensure that the power does not unduly encroach on other important public and private interests. First, the provision will only capture online locations where it can be established that the primary purpose of the location is to infringe, or facilitate the infringement, of copyright. As I made clear in my second reading speech, these amendments are designed not to apply to virtual private networks, or VPNs, that are promoted or used for legitimate purposes. VPNs have a wide range of legitimate purposes, not least of which is the preservation of privacy—something which every citizen is entitled to secure for themselves—and they have no oversight, control or influence over their customers' activities.
I have used the example of an Australian using a VPN to create the impression that they were located in the United States so that, when the American site saw the IP address, they would see a US IP address. This Australian could then—and this is widely done—purchase the content in the normal way with a credit card. The owner of the Australian rights to the content so acquired might well be quite unhappy about that, but they could take a remedy against the American site or the underlying owner of the rights. This bill does not apply to a site like this. It is not intended to apply to VPNs.
Where someone is using a VPN to access, for example, Netflix from the United States to get content in respect of which Netflix does not have an Australian licence, this bill would not deal with that, because you could not say that Netflix in the United States has as its primary purpose the infringement, or facilitation of the infringement, of copyright. This is a very important point to make. If Australian rights owners have got issues about American sites selling content to Australians in respect of which they do not have Australian rights, they should take it up with them. The big boys can sort it out between themselves and leave the consumers out of it.
The second safeguard is the broad range of factors that reflect competing public and private interests that a court can take into consideration, and those factors include, for example, the flagrancy of the infringement or its facilitation; whether blocking access to the online location is a proportionate response in the circumstances; and the overall public interest.
The Senate Legal and Constitutional Affairs Legislation Committee has recommended that the bill be passed subject to four recommendations for improvement. The government thanks the committee for its deliberations and has accepted all of these recommendations, which have been addressed by the amendments to the bill and the explanatory memorandum that I am tabling today. The government has introduced an amendment to the bill which would give the Federal Court discretion to take into account specified matters in deciding whether to grant an injunction—rather than being required to take these matters into account—and what weight to place on these factors. This is consistent with the approach normally taken by a court in assessing whether to grant an injunction.
The government also proposes, in light of the committee's recommendations, two amendments to the explanatory memorandum. The first clarifies that appropriate orders that the Federal Court may make in granting an injunction could include a requirement that parties set up a landing page to which subscribers will be diverted if they try to access a disabled online location.
The second clarifies that, consistent with case law, carriage service providers should not be exposed to legal actions by subscribers as a result of acts or omissions in compliance with an order and that the court has discretion to make appropriate directions on the costs of implementing an order.
A further amendment proposed is to clarify the operation of the primary purpose test. Specifically, an online location could have the primary purpose of copyright infringement even if it operates in such a way that it derives profits from advertising revenue.
The government has also committed to review the operation of the bill 18 months after its commencement. I want to stress this point that I made earlier: we recognise that we are living in a very dynamic and disruptive environment, powered in large measure by the internet. We believe this is a very good policy response to this problem of internet piracy. We are comforted by the fact that the opposition is supporting the bill, and I want to acknowledge the support and constructive collaboration that the Attorney-General and I have had from the shadow Attorney-General, the member for Isaacs; and the shadow communications minister, the member for Blaxland. If this bill does not work as well as we would like, we will look at it again.
Both sides of politics have to recognise that the objective is to ensure that the creative industries that the member for Griffith was speaking about only a moment ago are fairly rewarded for their efforts and that online piracy is brought to an end, so we have to be very agile in our approach to this. This is a good set of measures. It is the best model we have at the moment, but, if it does not achieve its objectives, we have got to be prepared to come back and change it. That is why we are committed to reviewing the operation of the bill 18 months after its commencement.
The bill is not intended to operate in a vacuum. The availability of content that is timely and affordable is a key factor in the solution to online copyright infringement. When infringing sources of content are disrupted, this disruption will be most effective if Australian consumers have legitimate sources to turn to that provide content at competitive prices and at the same time that it is available overseas. Furthermore, the industry code negotiated by internet service providers and rights holders is intended to provide a mechanism to inform Australian consumers of legitimate sources of content. The industry are in final negotiations around how that code will be paid for and implemented, and the ACMA is currently considering whether to register this code.
In conclusion, the bill provides an effective contribution towards addressing the longstanding problem of online copyright infringement and it does so in a proportionate and balanced way that takes into account other important public and private interests. It was the result of extensive consultation and it complements other initiatives by industry. I want to thank all honourable members who have contributed to this debate for their contributions, and I commend the bill to the House.
The original question was that this bill be now read a second time. To this, the honourable member for Isaacs has moved an amendment that all words after 'That' be omitted, with a view to substituting other words. The immediate question is that the amendment be agreed to.
Question negatived.
The question now is that this bill be now read a second time.
Question agreed to.
Bill read a second time.
I present a supplementary explanatory memorandum to the bill and I move the government amendment as circulated:
(1) Schedule 1, item 1, page 4 (line 8), omit "is to", substitute "may".
Question agreed to.
Bill, as amended, agreed to.
by leave—I move:
That this bill be now read a third time.
Question agreed to.
Bill read a third time.
In continuance of the goodwill and good spirit that we have just seen in the House and the common sense and consensus, I will continue in that vein. Labor is very happy to support the Australian Small Business and Family Enterprise Ombudsman Bill 2015 and the Australian Small Business and Family Enterprise Ombudsman (Consequential and Transitional Provisions) Bill 2015.
Labor will support the bills to establish this new role. Briefly, the Australian Small Business and Family Enterprise Ombudsman Bill 2015 deals with the establishment of an Australian small business and family enterprises ombudsman, its functions and powers and the relationship between Commonwealth and state laws.
The second bill, the Australian Small Business and Family Enterprise Ombudsman (Consequential and Transitional Provisions) Bill 2015, deals principally with issues of overlap between the existing statutory office of the Commonwealth Ombudsman and any other transfer of information from the Ombudsman's office to the new ombudsman.
Additionally, the bills deal with matters relevant to the work of and information currently held by the Australian Small Business Commissioner and the transfer arrangements to the new ombudsman. The bill describes the role of the new ombudsman as having an advocacy function and an assistance function. Under the assistance function, the ombudsman may respond to a request for assistance by an operator of a small business or family enterprise. The ombudsman must transfer a request for assistance to another Commonwealth, state or territory agency if the agency could deal with the request and if it would be more effective and convenient for the agency to do so. And where the assistance requested relates to a dispute with another entity, the Ombudsman may recommend that an alternative dispute resolution process be undertaken.
The Small Business and Family Enterprise Ombudsman is a statutory appointment with statutory powers supported by legislation. Many of its advocacy functions are not dissimilar to the current functions undertaken by the Small Business Commissioner, a role that was established by the previous Labor government. Labor believes the two key principles for defining an Ombudsman are independence and impartiality. Based on these important principles, I wish to place it on record that Labor has some concerns that there are sections in the bill that go to the oversight and advocacy roles of the Ombudsman.
One example can be found in sections 67(2)(b) and 67(2)(c) of the bill, which refer to the circumstances in which the Ombudsman is authorised to deal with a request for assistance. The bill suggests that the Ombudsman has no authorisation to deal with matters that relate to a minister of the Commonwealth, state or territory or the action of an agency of a state or territory. And section 69(1) of the bill, which refers to the circumstances in which the Ombudsman must transfer a request for assistance to another agency, implies that, if the Ombudsman believes another government department can deal with an issue, he or she must refuse assistance. I would have thought requests to the Ombudsman for assistance stemming from actions between a small business and a government agency may be quite common—and that is the very basis for having a statutory independent person to assist with such requests.
Labor considers that the Small Business Ombudsman should be a truly independent and impartial advocate for small business, and any limits placed on requests for assistance by a small business should be at an absolute minimum. Section 69 of the bill will enable the Ombudsman to refer a matter if he or she reasonably believes the request for assistance could have been made to another agency of the Commonwealth, state or territory. The last thing a small business would want when it has sought assistance from the Ombudsman on a matter between the small business and another Commonwealth agency is for the matter to be simply referred on to another government agency and not dealt with effectively or resolved. There is a view that this could compromise the independence and impartiality of the office of the Small Business and Family Enterprise Ombudsman as a true advocate for small business. Labor would seek clarification on this from the minister.
Prior to the last election the then shadow minister for small business, who is now the Minister for Small Business, referred specifically to overhauling the role of the Small Business Commissioner as being high on his agenda and said he wanted the role to have legislative powers to resolve disputes, including to make binding decisions and to mediate disputes between business owners and the Commonwealth. Labor is concerned that sections of this bill are inconsistent with what the minister said before the election. There are some other matters of concern in the bill—notably, section 30, which deals with termination of appointment, does not include a statutory immunity clause. Labor has also noted that the Small Business and Family Enterprise Ombudsman would be given powers to hold hearings upon referral by the minister. So there are a number of issues Labor is noting for the record. However, I wish to emphasise that we do support the bill. But, as always, Labor will watch closely the effectiveness of the new Ombudsman and we will continue to look at improvements that would strengthen and empower that office to support small businesses. It is important that the most effective oversight and advocacy services provided by the new Ombudsman role for small business are not limited or constrained by legislation where a matter in dispute may be between a small business and another Commonwealth agency.
Labor's record of support for small business speaks for itself. Let me remind the parliament and the public that it was a Labor government that gave small business an advocate in the Commonwealth government by appointing the very first Commonwealth Small Business Commissioner. It was a Labor government that appointed the first federal government small business minister, Barry Jones, in July 1987—and it was John Howard who removed the position from the cabinet in 2001. It was a Labor government, led by Julia Gillard, that restored this position to the cabinet in 2012. When Labor sought to lower the corporate tax rate for small business, in 2010, it was rejected by the Liberals in cahoots with the Greens. It was Labor who introduced significant preferential taxation assistance measures for small business—including tax loss carry-back, instant asset write-off, special depreciation for motor vehicles and the R&D tax incentive—cumulatively worth in excess of $7 billion of direct assistance to the sector. And, once again, it was a Liberal government that showed how little it understood the cash flow needs of small business by cutting these important tax assistance measures.
Labor established the Small Business Support Line and the business.gov.au website as a one-stop shop for information for small business people in a simple and accessible way. Labor also established the Small Business Advisory Services Program delivered through business enterprise centres and chambers of commerce. Labor established the Small Business Superannuation Clearing House allowing employers, including small businesses, to have one simplified location for processing employees' superannuation. Labor established the National Business Names Registry saving money and reducing red tape for small business—quite significant in terms of the direct saving for small business. It was the former federal Labor government that established the first Australian Small Business Commissioner to advocate for, and represent the interests of, small business directly to government.
On 2 January 2013, Mark Brennan, the new Small Business Commissioner, commenced his role as a high-level advocate in government representing the interests of small business and identifying opportunities to further reduce red tape. The commissioner worked in consultation with key small business stakeholders—including industry organisations, small business operators, state small business commissioners and other government agencies—to ensure that small business concerns were heard and taken into consideration across government. That work was so good the reforms continue today. Labor provided funding of $8.3 million over four years to establish the Australian Small Business Commissioner. The commissioner was not a statutory appointment and had no formal investigative or regulatory enforcement powers under any legislation. The commissioner's role is to raise awareness of existing effective services available at the Australian government and state and territory levels to assist businesses in resolving disputes. If one were to listen to the current small business minister when he talks about this new role being a 'concierge' service, one would look very closely at the similarities between the two roles.
Labor also appointed the Australian Small Business Commissioner as a result of feedback from two pieces of work conducted by the department. In 2010 the department commissioned a survey of over 2,000 small businesses across Australia to get more information on the incidence rate of small business disputes. Then, in March 2011, the former Minister for Small Business, Senator Nick Sherry, asked the department to develop an options paper to examine ways to assist small business to deal with business-to-business disputes, which was followed by the release of an options paper for public comment. Labor then called for expressions of interest for the commissioner position in June 2012, with the appointment being announced on 17 October 2012, followed by a merit based selection process run by the department. It is perhaps proper to place on the record also that the Small Business Commissioner, Mark Brennan, is doing an outstanding job advocating for small business and has done so since he commenced in the role in 2013.
As with the small business appropriation bills, Labor will support the Australian Small Business and Family Enterprise Ombudsman Bill 2015. However, our concerns remain at some of the measures in the bill, and Labor is ready to work with the government to ensure that small business has access to the very best advocate from a truly independent and impartial service.
It is a pleasure to rise in this place to speak on another one of our bills in support of small business and enterprise, the Australian Small Business and Family Enterprise Ombudsman Bill 2015. The government is funding $8 million over four years for the creation and ongoing operations of the ombudsman, who will advocate for the Australian small business community.
As we have seen in much discussion over the past few weeks, small businesses and family enterprises play an integral role in the Australian economy, to the extent that they represent around 97 per cent of all Australian businesses, and it is these small business people who face many daily challenges as they seek to expand their business, and they put their whole life on the line. Family enterprises, too, share these challenges, and face many issues because of the nature and characteristics of family business. That is why small businesses and family enterprises need a strong advocate to represent their interests—an advocate who can represent a range of issues, from red tape to taxation—and to be treated as though they were big business with all the resources possessed by Australia's larger companies.
This bill seeks to address the relationship between Commonwealth laws and state laws, and establishes an ombudsman and specifies the functions and powers of the ombudsman. The ombudsman has both advocacy and assistance functions.
This bill will provide significant support to Australia's small business and family enterprise community, with an ombudsman that will undertake research and inquiries into legislation, policies and practices on their behalf. The value, we hope, will be that Australia's small business people will no longer feel left out of the loop, with an ombudsman who will work collaboratively with industry bodies and other groups to advocate and bring a voice to the federal government. The Australian Small Business and Family Enterprise Ombudsman represents a positive opportunity to establish a highly regarded advocate who will act as a conduit for issues that small businesses and family enterprises face. It is envisaged that the ombudsman will provide valuable leadership and promote a nationally consistent and coordinated approach to the issues small businesses and family enterprises face, by collaborating with state small business commissioners, other state and territory officials and peak industry bodies. The ombudsman will raise the concerns of small business and family enterprise in discussions and interactions across both the public and private sectors.
The Australian government is committed to a general deregulation agenda. A 2012 university study found that small businesses in Australia were spending around $28,000 and nearly 500 hours per year on red tape and compliance burdens. In establishing an Australian Small Business and Family Enterprise Ombudsman, we seek to reduce the regulatory burden at a Commonwealth level by undertaking activities including: reducing administrative burdens—for example, suggesting simplifications to administrative forms and processes; minimising the costs businesses incur in complying with regulations; providing advice on matters affecting the interactions of small businesses and family enterprises with Commonwealth agencies; conducting investigations into industry sectors in which small businesses and family enterprises face particular problems; and making recommendations on practical solutions to reduce burdensome regulation. In establishing the ombudsman we hope that it will, in effect, lead to a net reduction in the regulatory burdens faced by businesses, with broader net economic benefits to businesses estimated to be in the order of $18 million per year. But broader net economic costs associated with the ombudsman's assistance function include staff time and out-of-pocket expenses relating to participating in an ADR process. Economic savings relate to avoided court costs, where a dispute is resolved through the ombudsman's assistance function rather than through a court.
With more than 11,000 small businesses in the Forde electorate, the Small Business and Family Enterprise Ombudsman will go a long way to assisting these businesses deal with the issues they face on a day-to-day basis and allow the hardworking men and women who run small and family businesses to focus on what they do best: and that is, to build and grow their businesses and employ fellow Australians.
The ombudsman will cut costs significantly for business people across Australia. This bill reduces regulations and administrative burdens. The ombudsman will offer advice and recommendations, and provide a better service and collaborative effort on solving industry problems. The Australian Small Business and Family Enterprise Ombudsman Bill will improve support and reduce expenses for Australian small businesses, and I commend this bill to the House.
This Australian Small Business and Family Enterprise Ombudsman Bill 2015 and the related bill are yet another fine example of the coalition government's steadfast commitment to small businesses across Australia. It is fitting that in this week, the week in which the government's historic small business tax relief package passed the other chamber, that we are here once again talking about common sense legislation that will make a real and significant difference to the small business sector in this country.
The coalition understands that small business owners face particular challenges in growing their businesses, employing more staff and remaining profitable. As a former business owner myself, I have spoken before in this place about the daily challenges faced by small business owners. Margins can be tight, markets can be crowded and competitive—and larger players do not always play fair. Building a business can take time away from time spent with family and friends. Cash flows and credit lines are a constant source of concern.
In such a challenging environment friends are important, and by now it should be abundantly clear that the coalition is the true friend of small business. Those opposite make shallow attempts to talk themselves up as pro small business. Labor talks a good game, as always, but let us take a look at the facts.
It is the coalition government that has delivered the lowest corporate taxes for small business in almost 50 years. It is the coalition government that has delivered the policy of instant 100 per cent depreciation on each and every small business capital purchase up to $20,000 in value. And it is the coalition government that has announced reforms to generate the more than $2.45 billion in annual red tape compliance cost savings. And now, again, it is a coalition government that, with this bill, will fulfil an election commitment to establish an Australian Small Business and Family Enterprise Ombudsman to provide adequate advocacy and assistance to the small business sector.
The contrast with Labor's record could not be clearer. Labor's small business policy is shambolic. Labor did nothing about reducing corporate tax for six years, while burdening Australians with 21,000 additional regulations. Despite their poor record in government, a week before the 2015 budget the member for Oxley, as Labor's shadow business spokesman, had the hypocrisy to criticise the government's plans to cut tax for small business and to create a tiered corporate tax system. Then, in his budget reply, the Leader of the Opposition ignored his spokesman and offered up some vague motherhood statements about small business-specific tax cuts. The problem is that they are completely unfunded, and the small business sector can have little confidence that Labor has the means, or indeed the intention, of ever delivering.
Let us look at Labor's position on the instant 100 per cent depreciation write-offs up to $20,000. Labor has attempted to pretend that this was in fact their idea. Indeed, it is the case that under Labor there was a less-generous instant asset write-off of up to $6,500. But what Labor is keen for everyone to forget is that the reason that write-off existed was to compensate small businesses for the effect of Labor's business-destroying carbon tax and mining tax.
Of course, the unedifying farce that is Labor's policy on small business has continued in parliament. Having just last month opposed tiered small business tax cuts, the opposition then thought these measures were so important that they had to pass this House immediately—without debate. They did not even want the members of this House to have the opportunity to speak in this place about the many small business owners in their electorates who will benefit from these changes. When it comes to small business, Labor just does not want to hear the good news.
But the good news just keeps on coming with a coalition government. As I said earlier, this bill establishes an Australian Small Business and Family Enterprise Ombudsman. Small business owners know they have friends in the coalition government; this bill will ensure that they have a friend in the bureaucracy as well. The ombudsman will have two main functions: an advocacy function and an assistance function.
In terms of advocacy, the ombudsman will continue the work of the Australian Small Business Commissioner. That position was created but never properly legislated by the former government, and the work begun by Mr Mark Brennan in the role will continue under the new ombudsman. The assistance function will establish an alternative dispute resolution mechanism that will provide improved access to justice for small businesses at the Commonwealth level.
I say 'Commonwealth level' quite deliberately, because the intention here is not to duplicate the resources of other officials at a state level. Small business is generally well served by a range of state and territory small business commissioners and other officials. The ombudsman will merely play a complementary role, working with existing state and Commonwealth agencies to fill the gaps in the system and, where possible, referring people to existing resources so as to avoid the 'forum shopping' of grievances. The ombudsman will provide an outsourced alternative dispute resolution service that will incentivize parties to participate genuinely in the process. It is hoped that this service will help improve business productivity, preserve business relationships and avoid litigation.
The Minister for Small Business is to be commended for introducing this bill and the other small business-friendly bills associated with the 2015 budget. At last, after the procession of ministers occupying the role under Labor, the small business sector has a true champion and a voice at the cabinet table. The Small Business and Family Enterprise Ombudsman is just one of a range of measures that the coalition government has implemented to assist small businesses to do what they do best—to invest, to employ and to grow.
I have spent considerable time engaging with many of the 13,000 registered small business owners in my electorate of Ryan since the budget announcement. They are telling me that at last they feel like they have a government that listens, a government that understands and a government that acts in the best interests of small businesses and their employees. I commend the work of the minister and his office, and I commend this bill to the House.
Like the previous speaker, I would like to acknowledge the work of the Minister for Small Business, the Treasurer and the Prime Minister in relation to their commitment to small business—and we have seen that very graphically displayed throughout this budget. The Australian Small Business and Family Enterprise Ombudsman Bill 2015 addresses the relationship between Commonwealth and state small business laws. Small business and family enterprises, as we know, play a very significant role in the Australian economy. The Australian Bureau of Statistics—which defines a small business as being one with fewer than 20 employees—has indicated that small businesses represent approximately 97 per cent of all Australian businesses and employ around 4.6 million Australians. Many small businesses are also family enterprises and they represent approximately 70 per cent of all Australian businesses. Of the over two million actively trading businesses in Australia, almost 96 per cent of them are small businesses and 3.8 per cent are medium-sized businesses.
Small businesses alone—those with fewer than 20 employees—account for 46 per cent of all of Australia's workers in the private sector. That is the reason I commend the work of the small business minister. That is why we in the coalition understand how important small business is and it is why we have placed such a strong focus on the needs of small business. Of course, small businesses know very graphically that they have never had a better friend in Canberra than the coalition. When I look around Western Australia, I see that 97 per cent of all privately-owned businesses in WA are small businesses and that they account for around one-half of private sector industry employment. There are 210,000 small businesses in Western Australia making up 43 per cent of all goods exported. Of course, the number of small businesses offering flexible hours has increased and there are a number of other real benefits through working for a small business.
In my own electorate there are 12,716 small businesses, and there are over 14,000 in the broader south-west. I looked at the breakdown of those businesses and there are: 3,550-plus in business services, 2,766 in construction, 1,990 in agriculture, 1,669 in distribution services, 1,236 in personal services, 682 in social services, 550 in manufacturing, 49 in mining and 31 in utilities. When you consider the services sector, the Treasurer talks about the fact that the services sector makes up 70 per cent of our economy but only 17 per cent of our exports. There is a great opportunity for many businesses in the south-west in relation to export and in relation to our free trade agreements. This is certainly facilitated by the decisions that we have made throughout this budget.
Even with this particular piece of legislation, we know that small businesses—those small and family enterprises—absolutely need a strong advocate who can represent their interests. A strong advocate can help small businesses and family enterprises by advocating on, for example, red tape, taxation and other issues and problems that they may face. A good regulatory regime can make a considerable difference to the productivity of businesses and decisions about when, or whether, a business should proceed with an investment—a critical decision that every small business makes because they invest their own money, they often mortgage their homes and they take huge risks.
The activities which the small business ombudsman may undertake to reduce the regulatory burden at the Commonwealth level include reducing administrative burdens—perhaps by suggesting simplifications to administrative forms and processes—by minimising the costs businesses incur in complying with regulations. We hear constantly from small businesses about the burden of red tape. It is the bane of their lives. They are so busy working in their businesses; the last thing they need is layer upon layer of red tape. When you see that we have taken $2 billion worth of regulation and cost out of the business sector, you know that we are certainly focused on business across the board and small business in particular.
The small business ombudsman could provide advice on matters affecting the interactions of small businesses and family enterprises with Commonwealth agencies. For those of us who are members of parliament, we understand that some of those people often knock on our doors. Another role for the ombudsman is to conduct investigations into industry sectors, in which small businesses and family enterprises face particular problems—and there are some particular problems. The ombudsman could make recommendations on practical solutions. What we want to hear from the ombudsman is practical solutions to reduce burdensome regulation.
The ombudsman presents a positive opportunity to establish a highly regarded advocate—someone whom small businesses can trust, perhaps like they trust this government, particularly after this budget. The ombudsman will act as a conduit for issues that small businesses and family enterprises face at the Commonwealth level and will promote a nationally consistent and coordinated approach to these issues. The ombudsman will also play a valuable leadership role in collaborating with the state small business commissioners, as well as coordinating with other state and territory officials in the small business space and with peak industry bodies. The ombudsman will raise the concerns of small businesses and family enterprises in interactions across both the public and private sectors. In this expanded role, as a Commonwealth-wide advocate for small businesses and family enterprises, the ombudsman will have information-gathering powers and this will be particularly important. The ombudsman will have the power to conduct hearings, to investigate matters and to make recommendations to the government. They are particularly important powers of the—Time expired.
I rise tonight in this adjournment debate to share some of the reflections that I have had over the past year during the events I have attended across Melbourne's west and in my electorate. Last week, I attended a forty-year celebration of the Vietnamese community in Australia. It was 40 years since the fall of Saigon, 40 years since boats first started leaving Vietnam with people fleeing and coming to Australia.
I spoke to people who had arrived by boat, who had taken the risky journey crammed with others seeking freedom after war and also those who had arrived by plane having been processed in neighbouring countries in later years. I spoke to them, their children and their grandchildren about the great contributions the Vietnamese community has made to Melbourne. Having worked a long time in the west of Melbourne and having taught a large number of Vietnamese children—some of them the age of some of the children in the room with us last week—I also remembered the hurdles to resettlement, the racism that we as a community had to find a way through, the racism that had to be challenged, the myths that had to be confronted and the support we had to put in place to build the community support for our great multicultural country.
I spent some moments reflecting on the leadership that it took at that time when I was working in a classroom, when these children were sitting in my classroom. Viv, a Vietnamese community member who was with me on the night, was reminiscing as we looked at the panels that recounted the war in Vietnam and the 40 years since. She shared with me a memory of hearing the Honourable Malcolm Fraser speak to a Vietnamese community where he challenged that community and said—this is as his sentiment, of course, not a direct quote—that they had been the beneficiaries of Australia's multiculturalism, the beneficiaries of bipartisan leadership and they had a responsibility in their new country to ensure that others were made welcome.
It was an interesting evening. It was one where I was actively reflecting on being a much younger person living in an Australia that had a real vision across the political spectrum about what our future might look like and what a wonderful multicultural country we might become. I raised my three children and they are beneficiaries of that wonderful time. That was one event across the week.
I, as we have heard on many occasions across the last two days, attended and the opening of the Regional Rail Link and I also attended the opening of the new recreation centre, the Eagle Stadium, in Wyndham. Both of these projects represent the power of partnerships, the power of a federal government—in this case a federal Labor government—with a vision, with a commitment to working with local government and with a commitment to listening to the people closest to those on the ground to deliver services and deliver funds to make life in communities stronger. These were great celebrations. They marked for me the support the electorate and the local government had received in infrastructure, and they marked the power of the productive relationships.
I also visited Headspace, another great Labor introduction but one that, thankfully, again had bipartisan support. I talked to lots of people across the electorate and then I returned to this place, where I am saddened that we are being actively divided—pensioner against pensioner, family against family. I am utterly amused that we have found a new line for the division, around windmills—an iconic Australian symbol, and we are going to divide around windmills. I look forward to continuing my work in this place in representing my community and finding a way forward, finding a new vision for Australia. If we cannot find that vision, I look forward to a long debate on the vagaries of the Hills hoist.
Capricornia is a large federal electorate spanning 91,047 square kilometres. Tonight I want to give you an overview of some of the things that we have achieved in the northern part of the electorate. This is an area that takes in small Queensland towns like Koumala, Ilbilbie, Sarina; areas on the outskirts of Mackay such as Racecourse, Ooralea and Walkerston; the Pioneer Valley district including Marion, Gargett, Finch Hatton and Eungella; and inland to Glenden and Collinsville.
I recently opened a new office in Sarina to help service northern Capricornia, which makes up an important part of the region. The new office is located at shop 8 in the Sarina Beach Road shopping centre. This was an election promise and complements my other office in Rockhampton. I encourage people in the northern part of Capricornia to contact me through this new office if I can be of any assistance.
In the past year, I have continued to fight for our local sugar industry in northern Capricornia, which faces increased pressure due to proposed changes to the one-desk sugar marketing system brought on by Singapore based sugar giant Wilmar. I am member of the federal sugar industry task force looking into the impact of such issues. I regularly meet with sugar industry leaders in the Mackay and Sarina districts and I continue to take a strong interest in their current dilemma facing local farmers.
Our government is striving to make highways safer in northern Capricornia through major road projects. I have successfully lobbied for $166 million of federal funds to fix up the Eton Range section of the notorious Peak Downs Highway, which runs from Walkerston west into the Central Queensland coalfields. This is not a federal highway, but Eton Range is considered such a dangerous black spot that our government is chipping in the bulk of money to fix it up. On top of this, our federal government is also providing $35 million to replace four old bridges on the Peak Downs Highway. We have also completed $8.5 million of new overtaking lanes on the Bruce Highway, under federal funding, making the highway safer between Koumala and Sarina.
Recently, to mark the Centenary of Anzac, the federal government provided a $21,416 grant to the Sarina RSL sub-branch's book committee for a new local history book. Titled More Than Just a Name, the book depicts the lives and service history of men and women who served in World War I from the Sarina region. At Marian, in the Pioneer Valley west of Mackay, the Australian government contributed $500,000 towards the newly revamped $825,000 Edward Lloyd Park.
Recently, I had the pleasure of opening the Sarina Art Extravaganza on behalf of federal Minister for Arts, Senator George Brandis. This is one of Sarina's most significant cultural events. In the recent federal budget, I was pleased to announce that up to 10 small Capricornia towns, including Sarina, Marian, Glenden, Dysart, Collinsville and Hay Point, will now find it easier to attract GPs thanks to an overhaul of the federal government's GP Rural Incentives Program. This spells good news for country patients.
Local food industries have also been highlighted at Parliament House. Matt West, President of the Australian Prawn Farmers Association, brought fresh prawns from his farm near Ilbilbie south of Koumala, as part of the association's prawn lunch to raise awareness about industry issues. Later this year, Capricornia will host parliament's Joint Select Committee on Northern Australia, which will focus on a hearing on the potential for more aquaculture in this part of Queensland. As our government focuses on the future development of Northern Australia, I continue to lobby for water and dam infrastructure, including the Urannah Dam project and the Connors River project as a longer term future scheme.
In other news, Marian State School and Sarina State High School were recognised by the federal government for taking action in their schoolyards to help protect the Great Barrier Reef. Both received cash grants under our Reef Guardian Schools program. During my travels in the northern part of the electorate, I was also fortunate to attend the 125th anniversary dinner of Homebush State School, about 50 kilometres west of Mackay.
It was Fyodor Dostoyevsky who said, 'The degree of civilization in a society is revealed by entering its prisons.' That may be true, but I say tonight that an additional degree of civilisation may also be revealed by entering its abattoirs and by looking at the way a society allows animals to be treated. We were all shocked at the recent footage of Australian cattle being cruelly treated in both Vietnam and Israel. When I heard about the abuse in the Arab town of Deir Al Asad I contacted the Israeli embassy to inquire as to the facts about what had happened there, and the result of the revelations. The House can be reassured that the Israeli minister for agriculture told me that he had already announced an investigation into both the abattoir and the veterinarian responsible for overseeing the conditions. The Dabbah abattoir in question has been closed pending an outcome of the investigation.
Of course, Israel has a legal framework in regard to animal cruelty, like Australia; but the agriculture minister, to his credit, has announced an increase in penalties for the mistreatment of animals. The Israeli reaction to these revelations is positive. It remains true that there has been a pattern of animal abuse scandals that have unfortunately affected the live export industry ever since this government has been in office. Its pattern has been underpinned by Agriculture Minister Joyce's contempt for animal protection. Need I remind some of the people of this House of the minister's explanations for the scrapping of Labor's proposed quality assurance body, the Independent Office of Animal Welfare? He said:
This is one bit of red tape that we can do without.
Or, more brutally, he said:
We all need to be realistic about the fact that livestock are raised for food.
Animal welfare is more than just red tape. Their treatment demands more than just fleeting consideration as food production. Proper animal welfare should be a standard to which any self-respecting government should strive. Indeed, it is in the enlightened self-interest of the industry that adequate regulations be enforced.
Whilst in government, Labor worked with farmers and industry to establish the strongest live trade and animal standards in the world. Back in 2011 Labor established the Exporter Supply Chain Assurance Scheme, forcing exporters to show that they have a plan to treat Australian live exports humanely and providing a monitoring and auditing system all the way from the port to the abattoir. The previous government committed itself to the establishment of an independent inspector-general of animal welfare. It was Labor that committed to establishing an animal welfare advisory committee in order to advise governments on standards for both sheep and cattle production, and livestock transportation. In the previous government I worked hard to implement new ways of improving animal welfare; recent scandals have shown that the work is not yet complete. I call on this government to work harder to put an end to the mistreatment of Australian livestock abroad.
First on the list of shame with this government, however, must be their plan to abandon Labor's plan to establish an inspector-general and to abolish the Animal Welfare Strategy Advisory Committee. Now it is talking of watering down ESCAS. A strong regulatory system is good for animal welfare, it is good for farmers and it is good for exporters. Let me be clear: the humane treatment of livestock is compatible with maintaining a sustainable agriculture sector in this country. However, the government's unpredictable changes to live export policy and its cuts to animal welfare programs should be of concern to both the industry and the community alike.
'Clean and green'—that should be Australia's export image. Minister Joyce's inaction is degrading our international brand. Labor will continue to fight any plans to wind back the animal welfare protections put in place while we were in government. To that end, the member for Hunter, my colleague the shadow minister for agriculture, introduced a motion into this House yesterday calling on the Minister for Agriculture to provide quarterly reports to parliament on any new markets, the number of head exported, any allegations of animal welfare breaches, investigations undertaken and any actions taken against those who have breached, or should have prevented breaches, of Australian standards. The member for Hunter has also called on the government to appoint an inspector-general of animal welfare.
As the member for Hunter said last night, the minister's report will place on the public record an easy-to-access and understandable account of the state of the sector, any animal welfare incidents and how they have been dealt with. This and the appointment of an inspector-general will be critical to rebuilding and maintaining public trust. The ball is now in the government's court.
I can think of few programs that are more important to our nation's future than the Medical Research Future Fund. By introducing this fund, the coalition government are confirming our ambition for a strong, vibrant and well-established medical research sector in this country.
We have always been a clever country. Despite our comparatively small population, Australians have been at the forefront of some of the world's greatest medical advances. Many Australians will be aware of the pioneering work of Howard Florey in the 1940s. His breakthroughs in the manufacturing and processing of penicillin, the world's first antibiotic, won him the Nobel prize and saved millions of lives worldwide. More recently, Australians have been behind the development of the ultrasound and the bionic ear and advances in in-vitro fertilization, or IVF. And Queenslanders are particularly proud of the work of Professor Ian Frazer, a researcher from the University of Queensland, in the electorate of Ryan, who led the development of the Gardasil vaccine for cervical cancer.
Australia punches above its weight when it comes to basic research. We have 0.3 per cent of the world's population but generate 10 times that much—three per cent—of the world's basic research. But, with so many talented scientists generating so much promising research, the competition for research funding is fierce. Only around 15 per cent of last year's grant applications to the National Health and Medical Research Council were successful in receiving financial support. That is not to say that the other 85 per cent of proposals were not worthy of funding. There is simply a finite amount of funding to be distributed.
Clinical trials can take many years and can be prohibitively expensive. As Australia is a small nation, our medical researchers face the additional challenges of a small population from which to draw trial participants and an undeveloped venture capital market. What this has meant in recent times is that, far too often, promising research falls by the wayside for no other reason than a lack of funding. Researchers tend to refer to such projects as having entered the 'valley of death'.
For this reason, medical research in Australia has reached a crucial time in its development. Our basic research is world class. We have an abundance of well-qualified researchers, established research institutes and highly regarded tertiary institutions. And yet we are losing our best and brightest researchers, along with their research, to other nations or, worse, from the industry entirely because as a nation we have not been doing enough to support them developing their research from the laboratory to the market.
That is why the Medical Research Future Fund is so important. The Treasurer has referred to it as a game changer for Australia. With this fund we have committed to take decisive action to ensure that medical research in Australia has a long, sustainable and successful future. It is always a pleasure to read about Australian medical researchers making discoveries that will change people's lives. But, for the good of this country, I want them to be Australian researchers based in Australia at places such as the Institute for Molecular Bioscience, at the University of Queensland.
I am pleased that this sentiment is shared by eminent representatives of the medical research field in Australia. When the enabling bill was introduced to parliament, I received a letter from Peter Scott, Chair of the Medical Research Future Fund Action Group. In the letter he said:
The MRFF legislation is the sort of bold, far-sighted policy we so often seek from our politicians. By preserving the $20 billion fund into perpetuity, the MRFF will provide a secure and stable source of funding for health and medical research … helping safeguard the future health of Australia's ageing population and improving their quality of life for generations to come.
This is high praise indeed from a group representing some of the leading medical research institutes in Australia.
It is expected that this fund will support investment across the research spectrum from the laboratory through to clinical trials, the commercialisation of new drugs and devices and the translation of new techniques or protocols into clinical practice. I am pleased that the Treasurer has acknowledged that commercialisation and translation are to be supported. For too long these steps have been the missing link in the progression of medical research in Australia. They have recently begun to attract the focus of government, and it is heartening that they will now receive the funding to go with it.
It is my hope that in decades to come, long after we are all gone from this place, future generations will look back on this fund and see it as the starting point for the next great Australian medical breakthroughs.
Hidden away in the Lurg Hills, between Glenrowan and Benalla, in north-eastern Victoria, is a wonderful example of community conservation: the Regent Honeyeater Project. Since its inception in 1994, this remarkable, independent, not-for-profit project has established itself as one of the most active volunteer conservation projects in the whole nation. It has engaged a whole farming community in bringing real change to our landscape and environment.
Let me share a few statistics with the House. In the last 21 years, 23,000 students and 10,000 community volunteers have worked tirelessly to protect and restore significant remnants of box and ironbark habitat. This habitat provides a more secure future for threatened bird and animal species such as the critically endangered regent honeyeater, the grey-crowned babbler, the squirrel glider and the brush-tailed phascogale. Over this time, volunteers have propagated and planted an incredible 586,000 seedlings, covering more than 1,500 hectares, at over 530 sites. They have put up 260 kilometres of fencing, have installed hundreds of nesting boxes providing crucial habitat for rare mammals and continue to provide ongoing monitoring of the boxes every autumn.
These are impressive statistics and are a testament to the tremendous work of volunteers. And, as their project coordinator, Ray Thomas, told me, the entire project would not be possible without the 150 landholders—that is over 95 per cent of the people who own land in this area—who have made their land available for this project.
Thank you, Ray, and thank you to your project team and the many volunteers who have contributed. But thanks also, for continued financial support, to the many corporate sponsors, charitable trust donations and the Victorian and federal governments. Thanks to the Goulburn Broken CMA; to Caring for our Country, the grants for environmental and heritage organisations and the Natural Heritage Trust, of the Commonwealth government; to Telstra; to Exetel; to Rockwell Collins; and, importantly, to the Norman Wettenhall Foundation for their long-term support, particularly to employ the project officer. The Department of Sustainability and Environment, as it was then known, also provides office space for the project management.
Other self-generated funds come from the 40,000 to 45,000 seedlings that are propagated and planted each year by project staff and volunteers. The Goulburn-Broken CMA supports the on-ground work and provides revegetation grants after the sites are planted out. Students from 23 local schools help with the propagation and planting, along with wider community volunteer groups, including bushwalkers, cyclists, scouts, church groups, bird lovers, shooting clubs and 4WD clubs. Valuable help is also contributed by Work for the Dole schemes for unemployed, and from out 'Land Mate' crew from Corrections Victoria. Thanks, guys.
Education is vitally important for the longevity of any conservation project. I know that Ray and the project staff are dedicated to educating the landholders, school groups, university students and community volunteers on the importance of threatened species habitat restoration. I think it is safe to say that with 33,000 volunteers and counting, they are doing a great job of convincing people.
The Regent Honeyeater Project is doing wonderful work in my electorate, but it is only part of the National Regent Honeyeater Recovery Project that is seeking to preserve habitat, and release and monitor birds right across the country. In April this year, in the Chiltern-Mt Pilot National Park, the fourth and largest release of captive-bred regent honeyeaters commenced. This release adds to the wild population in north-east Victoria and southern New South Wales. Three previous releases of captive-bred birds in 2008, 2010 and 2013 have confirmed relatively high, post-release survival and this round will provide a further boost to the species.
For the Regent Honeyeater Project and other conservation projects like it to succeed, the government needs to commit to ensure that habitat across the whole of Australia is protected by continued conservation funding and through sensible planning laws that take the habitat needs of our precious flora and fauna into consideration. Well done, guys. Thank you very much for all your work.
'Save the crabs, then eat them.' In March this year, the Parliamentary Secretary to the Minister for the Environment, the member for Paterson, came to Western Australia to launch the 'Save the crabs, then eat them' campaign of the South West Catchments Council. The campaign features two blue swimmer crab heroes, Crusty and Chrisso, who have some humorous but wise words about the impact that the application of fertiliser in gardens has on their world—our local waterways.
The program highlights the impact we have on our environment and how, working together, we can improve the outcomes by making simple changes. What better way to engage people in water quality than to link it to a story everyone can share. Everyone gets this story. Everyone wants to see crabs swimming in our estuaries and beaches, but we also love to catch them and eat them at the right time.
The campaign actually urges gardeners to think about the timing of when they fertilise their lawns and gardens—and certainly not when it is raining. The south-west waterways are world famous from Geographe Bay to Smiths Beach and the Margaret River coastline. They are a well-known destination for holidays, surfing, relaxing and fishing.
However, our rivers and estuaries are under increasing pressure from population growth because people love to live right next to the beach or the river. Pressures from this include escaped weeds from gardens, changes to water flow and fertiliser run-off from green lawns. In response, the Australian government has committed $2 billion over the next four years to help conserve, protect and rehabilitate Australia's natural heritage and support local action for natural resource management, like this particular South West Catchments Council.
As part of this, the National Landcare Program will invest $1 billion to help drive sustainable agriculture as well support the protection, conservation and rehabilitation of Australia's natural environment through projects such as 'Save our crabs, then eat them.' The campaign does this not by preaching science at people but by engaging them with things in the environment they are already connected with—the blue swimmer crabs, Crusty and Chrisso, and how delicious they are.
It focuses on the preservation of an iconic piece of our natural ecosystem by identifying its well-known benefits—we cannot eat the crabs, if we do not help them to develop. They have to grow. We know that rain carries excess fertiliser from suburban lawns and gardens into stormwater drains, rivers and estuaries, all the way to the ocean. Fertilisers can threaten these sensitive environments and the health of the fish and shellfish that live there like the blue swimmer crabs. This campaign is an excellent example of the National Landcare Program actually working in a practical way. It is a local campaign driven by the local south-west people in my part of the world.
The 'Save the crabs, then eat them' is a media campaign, mainly through television and radio, aimed at educating urban residents on the right time of year to fertilise, the right products to use and the right application amounts—practical advice. It will increase awareness of waterways and about catchment associated pollution. As part of their Home River Ocean campaign, it highlights and urges gardeners to think about the timing of their fertiliser applications. It is done very cleverly through Crusty and Chrisso.
These actions aim to capture people's imaginations and, ultimately, to change their behaviour to save the blue swimmer crab. This will allow the existing crabbing lifestyle and seafood industry to be sustainable. I congratulate the South West Catchments Council and its partners on this excellent initiative. 'Save the crabs, then eat them,' all hail to Crusty and Chrisso. Even at a community garden that I visited recently, they had a 'Save the crabs, then eat them' specialised garden that we could all look at to learn how we can save Crusty and Chrisso, and how we can make sure that those crabs are around at the right size when we want to catch them and really enjoy eating them. We see these beautiful blue swimmer crabs in our part of the world.
It is Crusty and Chris with their wonderful crabbie-type voices that are influencing people to make very good decisions about how and when they fertilise their lawns and gardens. I commend the South West Catchments Council on this wonderful initiative. Even children understand Crusty and Chrisso. What a great result and it is a great initiative.
Order! It being 9.30 pm, the debate is interrupted.
House adjourned at 21:30
I rise today to inform the House of a terrific celebration, an opening that occurred in Wyndham on the weekend, where I joined the Victorian Minister for Sport, the Hon. John Eren, and local mayor, Peter Maynard, and his fellow councillors to open stage 1 of our fabulous new stadium. Stage 1 of this stadium gives us eight new indoor courts and five brand-new outdoor courts, with another four indoor courts, a creche and a gymnasium as well as other facilities to come in stage 2. It is an absolutely fantastic facility. It is well laid out. It is a first-class highball stadium. I would like to congratulate the design and build team and the council for their vision.
At the opening I talked about partnerships, about what a great example it was of the levels of government working together for the local community, to practically support the volunteers in our community that make sport possible for our residents, and about the importance of health and fitness and the contribution competitive sport makes to that.
This stadium was the largest of the RDAF projects undertaken in partnership between Wyndham council and the previous federal Labor government, a project worth over $40 million, with a $9 million contribution by the former Labor government. Labor cares about communities, and that is why we delivered the Regional Development Australia Fund. We invested more than $1 billion to leverage projects worth more than $2.7 billion across Australia. In total, the Wyndham community benefited from almost $14 million from the previous federal Labor government in funding for 11 projects. They included the Wyndham Vale Community Learning Centre, the Featherbrook Community Centre in Point Cook and various other projects—11 in total.
I note that it is timely to talk about these things. It was exciting to be there, but it is also important that this week local governments are here in Canberra for their conference. I hope my local governments are booking meetings with those opposite to talk about funding for my local area, because they will lose more than possible contributions through regionally targeted funds; they will also lose money for essential services.
There will be millions lost in Wyndham in financial assistance grants that are being cut by this government. This will mean less money for local roads, decent libraries—which of course, as I have said before, are a priority locally to support literacy for our young people—and for well maintained parks and things like our local football grounds getting the upgrades that they so desperately need. Under this government, my local community is suffering. My local council is suffering and I would like to draw the attention of the House to what these cuts will mean to families in Lalor. (Time expired)
On Sunday, 7 June, a good friend of mine, Ben Pistola—better known as 'Pistol'—died at the age of 36. Ben was an exceptional golfer, with a handicap as low as one. He won many events as a junior, played golf for his state and won a club championship at his beloved Grange Golf Club. He was a member of the successful Grange Simpson Cup teams in 1999 and 2000, in his early 20s.
Ben was always young at heart, a kind soul and a fierce competitor who never gave up. He operated very much by Arnold Palmer's rule that the harder he worked the luckier he got. Even a social round of golf would nearly always result in a significant side bet and always a light-hearted sledging of the failings of his opponent's game, which in my case are many. It was appropriate he finished his final round with a birdie on his final hole, the day before his death.
Of course, like many of us, Ben enjoyed the social side of the game as much as if not more than the game itself. He enjoyed a beer, a joke and the companionship of his mates. I will always enjoy the memories of nights following golf at the club or back at the Mile End bachelor pad, where Ben was our unofficial fourth flatmate, or even the occasional Adelaide nightspot—in particular, the Havelock hotel.
Ben had been battling his demons in recent months and sadly this was a battle he could not win. It is a battle lost by too many in our society, particularly young men. It is a battle that our society struggles to grapple with, costing too many good people in the prime of their lives. A sad reality of this place is that you often do not have time to keep well connected with old friends, and in this respect I will forever regret not doing so with Pistol.
On Wednesday, old friends will gather at Grange Golf Club to farewell Pistol. They will grieve with his family and spend time remembering a good man with a big heart who has gone too soon. I am very sorry that I will not be there to celebrate his life. I am also very sorry I will not be able to be there to support his great mate, John Meijer, who must be enduring the most difficult pain. Rest in peace, Pistol. You will always be with us.
The camaraderie and friendship that comes with playing golf is something that the member for Mayo and I work on together as co-conveners of the Parliamentary Friends of Golf, and I very much hear his thoughts in that contribution and associate myself with them.
The Geelong CBD has been a topic of conversation in Geelong for many years now. How do we revitalise this urban heart in the context of a modern world where shopping malls tend to provide a place where more and more people do their shopping and have their retail experience? There is obviously a convenience in that, but by the same token the beautiful, magnificent buildings of the Geelong CBD and the retail space which they afford are something which now needs to be focused upon so that we have a vibrant CBD. It is a topic which has rightly consumed a lot of the attention of the local debate in Geelong. In that respect I particularly refer to the contributions made by Councillor Michelle Heagney, who is the ward councillor in the City of Greater Geelong responsible for covering Geelong's CBD.
In another respect, I would like to highlight a growing trend in Geelong, a fantastic trend, which is the emergence of a remarkable coffee scene in Geelong. Indeed, The Age Good Food Guide coming out of Melbourne describes the coffees scene in Geelong as 'going gangbusters'. Broadsheet, which is Melbourne and Sydney's online magazine covering food and drink and night life, says in relation to Geelong and its food and cultural attractions:
… you can't go past a day in the bay … Whether you're an art and history buff, a coffee lover …
It is something which is increasingly coming to define Geelong, and that is fantastic. A lot of those coffee shops are in the CBD: Coffee Cartel, A Spot for Joe and the Maddison Lounge, to mention just a few. Indeed, around the corner from my electorate office there is Freckleduck. I could go on. It is fantastic. We have seen an explosion of the coffee culture within our CBD, and it has led to the Geelong CAT Splash, which was a coffee and tea expo which highlighted the fantastic offering that Geelong now has in this respect.
This points to the future of the Geelong CBD. There will of course be retailing outlets of a variety of kinds in the Geelong CBD, but art, cafe, coffee and heritage are the future of the Geelong CBD. It is about making it a tourist destination for people from Melbourne. So today I am calling on the Geelong council to set up a laneway coffee festa in the heart of Geelong so that we can celebrate this culture and the contribution it can make to the revitalising of the Geelong CBD.
Madam Deputy Speaker Burke, you will recall that you joined me and others of our female colleagues recently at the Pacific Women's Parliamentary Partnerships Forum in Suva, along with other female members of parliament from the Pacific area. Unfortunately, our sisters from Bougainville could not join us because they were undergoing an election. Well, Madam Deputy Speaker, I am sure that you will join with me in celebrating the news today that Bougainville has handed down a landmark decision for women's equality by electing, for the first time, a woman in an open constituency seat. It is truly good news for the women of Bougainville. As we know, they have three reserved seats for women and three for ex-combatants, but this time the women fielded 35 candidates in total, and 12 of them took on the men in the open seats.
It is a very interesting dilemma. I was talking to the women when I joined the Australian contingent for observing the Bougainville elections recently, and they said the problem when you reserve seats for women is that the men think the women should only have those seats and, in some cases, that only women should be allowed to vote for women in those seats, and the men can have all the others. So they are very torn about whether to keep the reserved seats or to continue with their fight to take on the men.
As I said, 12 women ran for the open seats, and one of them has been elected. The four new politicians are Hellen Siumana, Marcelline Kokiai, Isabel Peta and, in the open seat, Josephine Getsi. Josephine won the open seat of Peit, a seat that was contested by both women and men in Bougainville. This election doubled the number of women who ran in open seats compared to the last one, in 2010.
I particularly commend the Bougainville Women's Federation, which supported the women running in the election, and which were, in turn, supported by the International Women's Development Agency, which provided leadership training in the election lead-up to encourage and support women candidates. This initiative was funded by the Netherlands government's Funding Leadership and Opportunities for Women, the FLOW program, as well as the Canada Fund for Local Initiatives.
But, Madam Deputy Speaker Burke, as you are aware, Australia has always been supportive of our sisters in Bougainville. Women's underrepresentation is still an issue and it does inhibit gender equality within any society. Newly elected candidate Josephine Getsi participated in the FLOW-funded workshops, including the leadership training for intending candidates, and two mock parliament trainings. Josephine says that she has now gone from 'a nobody to a somebody'. Congratulations, Ladies, we look forward to welcoming you to Brisbane and Queensland.
I share in the member for Ryan's excitement at that election result.
I am pleased to make a contribution today to discuss the upcoming ReclinkCommunity Cup. The Reclink Community Cup began in Melbourne some 21 years ago. Games have also been held in my electorate, in Henson Park, Sydney, for the past four years. The matches raise funds for Reclink, a fantastic organisation that promotes sporting and artistic programs for young people experiencing disadvantage. Reclink was established in Victoria, in 1990, and now operates nationally. It provides over 4½ thousand activities and 80,000 participation opportunities for disadvantaged young people every year. It targets some of our communities' most vulnerable and isolated people, including people experiencing significant mental health challenges, disability, homelessness, substance abuse, culturally and linguistically diverse communities, correctional services and economic hardship. Reclink bases its operations on the importance of sport and the arts in engaging young people.
The Melbourne event will be held this Sunday at Elsternwick Park. Gates open at noon, with bands playing, and the game gets underway at 2.30 pm. The Sydney match will be held on Sunday, 2 August, at Henson Park, Marrickville, in my electorate. Gates open at 11 am. It will, once again, see the music industry based Western Walers take on the media based Sydney Sailors. I will be playing again, after my debut for the Western Walers last year. The Western Walers are yet to win a game; they are old school. They do not win on the field, but they are pretty good fun off the field and play in the spirit in which a social game should be played. In the lead-up, on the Friday night beforehand, I will be participating in a fundraising event at the Newtown Social Club, with FBi radio, once again, raising funds for Reclink to undertake this important work that they do for disadvantaged young people. I hope people can get along there and enjoy the music played on that evening.
I would like to take this opportunity to acknowledge those recognised in this year's Queen's Birthday Honours List from my electorate of Lyons. John Cauchi AM was named a Member of the Order of Australia for his significant service to the law, to international relations and for prominent legal roles in the South Pacific. Mr Cauchi is, most notably, the former Attorney-General of Tonga with the Crown Law Department of the government of the Kingdom of Tonga. He was also senior crown counsel, from 1992 to 2001, and has held a host of prominent positions around Australia and the South Pacific. Mr Cauchi lives in Longford.
Tony Nicholson OAM was the recipient of the Medal of the Order of Australia. Mr Nicholson was the Derwent Valley mayor, from 2007 to 2009; deputy mayor, from 2000 to 2007; and a councillor, from 1998 to 2009, and again from 2011 to 2014. Mr Nicholson said at the announcement of the honours that one of his proudest achievements was helping the private sale and planned redevelopment of the old Royal Derwent Hospital site, at New Norfolk. He was a founding member and former chairman of the New Norfolk Historical Information Centre and a representative on the New Norfolk District Hospital board.
Tony Foster AM was awarded a Member of the Order of Australia for his significant service to local government through leadership roles, professional governance associations and the community of Brighton. Councillor Foster is now in his 23rd year as mayor of Brighton, making him the longest serving mayor in Tasmania.
The late Dorothy Robinson OAM was a recipient of the Medal of the Order of Australia. Mrs Robinson was the first female councillor elected in the Derwent Valley and is remembered as a crusader for change. She is believed also to have been the first woman elected to a rural council in Tasmania. Mrs Robinson served with the New Norfolk Council, now the Derwent Valley Council, from 1956 to 1962. Mrs Robinson died in June last year, aged 85. Her brother, Ken O'Brien, who is acknowledged as a great community worker, said she would have been 'chuffed' at this award.
Paul Lennon AO from Broadmarsh in my electorate is a former Tasmanian Labor premier. He is recognised as an officer of the General Division of the Order of Australia for his role in diversifying Tasmania's economy and his efforts in driving reconciliation with the state's Aboriginal community. Michael Polley AM, from Longford, is also a member of the Order of Australia. A former speaker of the House of Assembly, Mr Polley is another former Tasmanian politician, from a different political persuasion than mine, but his award is well deserved for his long service to his community. He served in the Tasmanian parliament for 41 years before retiring last year after becoming one of the youngest state ministers at the time, at the age of 26 in 1976. He continues to serve on the Northern Midlands Council. I congratulate them all.
On Sunday it was a great pleasure to join the Greek Orthodox parish and community of St Ioannis in Parramatta at an incredibly important event. It was the first service at the site of their new church, which they will build in the years to come on what was the old Parramatta Workers Club site on the banks of the Parramatta River. The service was held in a temporary church. It was officiated by His Grace Bishop Seraphim I, and it was an extraordinary event. They will build a Byzantine church on that site that will serve the Greek Orthodox parish for centuries, and it was an absolute pleasure to be there on the first day of those centuries.
It was only last week that the parish held its final service in the old St Ioannis church in Hassall Street. It was officiated by Father Nicholas Tsouloukidis. Following that service they collected the holy items from the altar and processed them, with a police escort, on foot through the streets of Parramatta to the site of the new church. To their delight, they were able to bring them all. About 60 years ago, I think it was, when they painted the icons in the old church, they intended to paint them directly onto the walls, but there was still some moisture in the wall so they put up canvas and painted the icons on canvas. They discovered only over the weekend that they could actually remove them, and it was a very long process to peel the canvas very slowly and with great trepidation, thinking they had lost them altogether. But they had this second chance at saving these wonderful paintings that were done so long ago in that church, and they all came off. They rolled them up and took them down to the new site. Then they spent a week turning what was an old function room in the workers club into a temporary church, and it looks spectacular. Again, as a pleasant surprise, so many of the icons that were high up in the old church, well above eyesight, are now within clear vision as you sit in that church.
It was an extraordinary day. People from the Greek community came from all over Sydney to share in the special day. The new location solves many of the problems they had in their old one, particularly parking—they were totally parked out. I arrived at about 10 o'clock, and I got a spot right outside the front gate, because there is parking on-site. But perhaps the most important thing about this site is that a parish named after St John the Baptist is on the banks of the Parramatta River. So, when they hold their vigil for St John the Baptist later this month they will do so on the banks of a river. It was a very special day, the first of centuries, the beginning of something quite wonderful, and I congratulate the Greek Orthodox parish for making it happen.
The drug ice is a significant issue facing this country, and I am pleased to inform the House that I recently hosted a high-profile ministerial hearing in Rockhampton to discuss the local impact of ice. The federal Assistant Minister for Health, Senator Fiona Nash, came to the beef city to spearhead a community round table on the use of crystal methamphetamines. This hearing was significant for Central Queensland. The statistics on the uptake of ice are alarming. I was shocked to learn that ice is more commonly used in regional and remote areas and has even made its way into some primary schools in the country.
The Rockhampton roundtable involved input from police, health workers, drug and alcohol workers, university academics and social welfare organisations. Information from the forum will be fed back to the Australian government's National Ice Taskforce inquiry. The task force is currently touring the country to examine existing efforts to address ice and to identify new ways to combat it by education, health and law enforcement programs.
I asked the assistant minister to bring the roundtable to Rockhampton because we are not immune from the ice scourge. In fact, the hearing was told it is a serious problem in central Queensland. One delegate, who operates a rehabilitation service, told of how he was inspired to help because his own daughter was an ice addict. Police say that ice addicts account for violent crimes, armed hold-ups and break-ins to obtain cash to feed their habit, while the director of Rockhampton base hospital's emergency department reported that ice addicts that fall into a violent psychosis were a danger to themselves and to other patients and families in the hospital waiting rooms.
Drug pushers are targeting regional Australia because they can get some of the highest prices in the world for ice here. Tackling the ice scourge, which is harming so many communities, is a top priority for our coalition government. I was delighted that the assistant health minister visited Capricornia, because ice use is a growing problem. It is ruining people's lives, destroying families and harming our community. Statistics showing the growth of ice and meth use are alarming. One in 14 Australians have tried ice; 200,000 Australians have used ice in the past 12 months; meth/ice imports jumped from five per cent of all illegal drug imports in 2011 to 59 per cent in 2014; and the number of people receiving treatment for meth use have doubled in Australia in three years.
The Australian government's National Ice Taskforce inquiry is a positive step to help identify ways to combat the issue through health, education and law programs.
Today I rise to acknowledge 43 women who are no longer with us—43 women who were victims of an epidemic of violence against women. Of these 43 women, most were killed privately in their own homes. Today I want to honour and commemorate the lives of these 43 women. In doing so, I acknowledge at the outset the work of journalist Jenna Price and the Counting Dead Women Australia researchers of Destroy the Joint, who undertake the heartbreaking task of updating this list of indescribable tragedy.
Today I want to honour the life of Tina Fang, aged 25; Ruth Dodd, aged 71; Rinabel Tiglao Blackmore, aged 44; Nikita Chawla, aged 23; Leila Alavi, aged 26; Renee Carter, aged 29; Fabiana Palhares, aged 34; Adele Collins, aged 39; Traci O'Sullivan, aged 41; Kerry Michael, aged 44; Ainur Ismagul, aged 55; Tara Costigan, aged 28; Dianne Chi, aged 22; Kris-Deann Sharpley, aged 27; Prabha Arun Kumar, aged 41; Angela MacKinnon, aged 55; Sharon Edwards, aged 55; Jackie Ohide, aged 27; Sabah Al Mdwali, aged 28; Masa Vukotic, aged 17; June Wallis, aged 22; Salwa Haydar, aged 45; Mai Mach, aged 60; Stephanie Scott, aged 26; Julie Hutchinson, aged 48; Daniela D'Addario, aged 35; Melita Hart, aged 18; Linda Locke, aged 51; Seker Yildiz, aged 49; Olga Neubert, aged 37; Weijin Zhing, aged 68; Rose-Marie Sheehy, aged 32; Lana Smith, in her late 50s; Brittany Shanice Harvie, aged 22; and nine other unnamed women.
On 5 June I joined my fellow Novocastrians at a candlelight vigil coordinated by One Billion Rising in Newcastle to commemorate these women. We know that for young women under the age of 45 the most likely cause of death or injury is domestic violence. This is a scourge, it is an epidemic, in our society. This senseless killing must stop—it must stop now. These women must not die in vain. Please, if you or someone you know is impacted by sexual assault or domestic or family violence, call 1800RESPECT on 1800 737 732 for help.
I am pleased to advise the House of my visit to Broome last week. I started the week with the northern Australia committee meetings on the aquaculture industry at the Broome Civic Centre. This gave me an opportunity to listen to local business people in my electorate and hear firsthand what the government can do to assist them to flourish. Thanks to James Brown, of Cygnet Bay Pearls and Patrick Moase of Clipper Pearls for telling us about the challenges facing the shrinking Broome pearl industry. Let me tell you, I will never question the price of a Broome pearl again; they are worth every penny. With its pristine waters and perfect climate, the Kimberley coast is ripe for aquaculture, but government has to play a role to ensure designated zones are investor-ready.
On Friday I was very happy to see one of my election commitments come to fruition, with the delivery of the SeaLegs rescue craft to Broome Volunteer Sea Rescue Group. The event was attended by the commander of the Broome Volunteer Sea Rescue Group, Lyle Smedley; former commander, Colin Kenworthy; Chris Wright; and the other brave men and women who volunteer their time to ensure the safety of those on the Kimberley coast. Along with the new Royal Flying Doctor Service base, these will be great additions to Broome and I am pleased to have played a role in delivering this for the town and the broader Kimberley region. This new sea rescue vessel, a major boost to the emergency capabilities of not just Broome but the Kimberley, is something I know Broome people have wanted for some time. This is one of mine and the Abbott government's election commitments of investing over $3 million in new air and sea rescue facilities through the Kimberley, and I am very proud to have delivered on that promise.
Early in the day I opened the new Australia Post superstore in Broome. The superstore features a state-of-the-art design and a wider range of products and services, which will change the way the people of Broome send and receive mail. These openings will further boost services in the idyllic town of Broome, one of Western Australia's fastest-growing places.
I am thrilled not just for the people of Broome but also for the many visitors who pass through the streets of Broome. For those of you who do not believe me when I talk about how diverse Durack can be, please come and visit Broome and you will be very pleasantly surprised.
In closing, I want to say that I am very happy to say that Broome has had an excellent start to its tourist season—long may it last. I want to take the few seconds available to me to acknowledge the hardworking hospitality and tourist operators in Broome, who have not had it so great the last few years. I really appreciate them hanging in there. Let us hope that the tide has now turned for them.
Recently I had the privilege of officially launching an Australian first in cave tourism at one of central Queensland's most famous tourist attractions. The $300,000 project involved relighting the historic Capricorn limestone caves, near a town aptly named The Caves near Rockhampton, to provide a more dynamic experience for tourists.
Inside Capricorn Caves awaits an amazing experience of stalactites and subterranean wonders. Old cave lighting from the 1960s was replaced with new, leading-edge, solar-powered LED technology, the first system of its kind in Australia. It is now the first cave experience of its type in Australia to run lights off solar panels; as such it will provide a template for other cave managers from around the world to come and learn ideas.
The project, expected to help increase tourism numbers to Rockhampton and the Capricorn coast, was completed with the support of a $150,000 federal government grant. I congratulate Capricornia Caves operator Ann Augusteyn and her wonderful team for achieving this extraordinary project, and I wish Ann all the best with the future operation of her business. The new lighting experience will also reduce the carbon footprint on the historic caves and has the potential to create further jobs. Thank you.
In accordance with standing order 193, the time for members' constituency statements has concluded.
I will make a brief opening statement before accepting questions relating to the Foreign Affairs and Trade portfolios. The 2015-16 budget is part of the Australian Government's plan to build a strong, safe and prosperous future for all Australians. The initiatives outlined in the budget will assist in advancing Australia's national interest in an increasingly complex economic and strategic environment. The transfer of global power, brought about by the re-emergence of Asia's great economies, instability in Europe and the Middle East, terrorism, tensions in the South China Sea and issues like infectious disease have emerged as potential fault lines in international affairs.
Managing the opportunities and the challenges that our country faces, now and into the future, requires a foreign policy that reflects our standing as one of the world's top 20 nations. We are a significant voice internationally. Australia's foreign policy projects and protects our reputation as a strong, open, export-oriented market economy and as an open, liberal democracy, with a strong commitment to freedom, the rule of law and democratic institutions.
While our priorities remain firmly focused on the region, our interests are global. In a globalised world, individuals and ideas on the other side of the world are just as capable of striking out at our interests as those in our own backyard. As I speak, over 300 Australian Defence Force personnel are in Iraq, training the Iraqi army in its fight against the terrorist group, Daesh. The rise of Daesh is not only a threat to the stability of Iraq and the Middle East region but a global threat, including to countries like Australia that celebrate liberal democratic values of freedom of expression, the separation of powers and gender equality.
The 2015-16 budget delivers $106 million to ensure the Australian Embassy in Baghdad continues to play its critical role in supporting our Defence Force personnel in Iraq, as well as the international effort to combat terrorism. The budget also provides $138.4 million to continue Australia's diplomatic engagement and security arrangements in Afghanistan. This budget lays the foundation for Australia's growing relationship with key economic and strategic partners in the Pacific, Asia and Middle East. The government has committed $98.3 million to establish new missions or posts in Qatar, Mongolia, Indonesia, Thailand and Papua New Guinea. It is the single largest expansion of Australia's diplomatic network in over 40 years.
We have also committed funds to rebuild the Australian Embassy in Washington DC, which had fallen into a shocking state of repair—you only have to ask the current Australian Ambassador to Washington, the Hon. Kim Beazley, about the need for repairs to the Australian Embassy.
In 2015-16 the Australian government will provide around $4 billion in official development assistance, ensuring that Australia remains one of the most significant providers of aid in the world. And Australia will have an aid program that we can reasonably afford. 'You cannot fund an aid program on borrowings'—quote, the former foreign minister, Bob Carr.
We have applied a rigorous analysis to country aid allocations to ensure our assistance is well targeted and supports economic growth and poverty alleviation. Aid to Pacific Island countries has been maintained in recognition of our primary responsibility to our neighbourhood and of their particular development challenges, while assistance to fast-growing Asian economies has been appropriately been scaled down.
We are taking an innovative, creative approach to overseas development assistance that will deliver better and more targeted outcomes, through sensible priorities, which will be subject of course to consultation with partner governments. The government has also committed additional resources to strengthen Australia's export performance and attract foreign investment, which will enhance our productivity and drive job creation.
Initiatives announced in the budget include: $18 million over four years to expand Austrade's current program of Australia Week events; $24.6 million over two years to promote business understanding of the recently concluded free trade agreements with the Republic of Korea, Japan and China; $30 million over four years to attract investment in the government's five priority areas—infrastructure, tourism, resources and energy, agribusiness and food, and advanced manufacturing services and technology; and $5.2 million over four years to expand Match Australia's sport business program.
These measures complement the Australian government's economic diplomacy agenda. Just as traditional diplomacy seeks peace, economic diplomacy seeks peace and prosperity. The Australian government will continue its efforts to ensure Australia is stronger, safer and a more prosperous nation.
Foreign policy is a major weakness for the Abbott government. In fact, Australia has become an embarrassment, routinely being criticised by leaders of other nations about our foreign aid cuts, our approach to climate change and our relations within our region. Only today we see on the front page of The Australian newspaper the Indonesian foreign minister actively criticising specifically this foreign minister for the comments made yesterday in respect of allegations of people smugglers being paid. This foreign minister has allowed $11.3 billion to walk out of the aid budget over the last three years. Without a doubt, this is the worst performance by a foreign minister in our nation's history when it comes to promoting overseas development aid.
In 2013-14, from MYEFO and the budget, $7.6 billion was cut from the aid budget. But that was not enough. In the next year the foreign minister allowed a further $3.7 billion to be cut from the aid budget—in total, $11.3 billion. What was the minister's response? The minister's response during the Treasurer's condolence motion on former Prime Minister Malcolm Fraser was to roll her eyes. That was it—she rolled her eyes. The Australian people need more than that. They need more than eye rolling. My first question to the foreign minister is: when the Expenditure Review Committee were cutting the $7.6 billion from the aid budget in 2013-14 and again in 2014 when they were cutting $3.7 billion, did the minister object to those aid cuts? The minister says that they want to increase the diplomatic footprint of the Australian government, despite the fact that the minister has allowed 549 jobs to be cut from the Department of Foreign Affairs and Trade. By 2016 Australia will spend just 22c in every $100 of national income on development aid, the lowest that it has ever been in our nation's history, and it will fall further under this government to 17c per $100 of national income.
This foreign minister has said that cuts to aid will not affect the Asia-Pacific region, but we see in the details of the budget papers that the Philippines, Indonesia, Vietnam, Laos and Myanmar will have their aid budgets cut by 40 per cent. The minister has given a guarantee that there would not be any cuts to the Pacific—our own neighbourhood, our own region—yet we find in the details of this year's budget papers that there will be a cut to the Pacific region of $55 million. The government claim that they are all about transparency. Where is the transparency? It was up to the individual aid organisations to discover these cuts themselves. On several occasions the opposition, the aid organisations, the NGOs, have been asking: where are the cuts going to come from on the ground? The minister and the government refuse to answer, and we now see that the government is abandoning the notion of a blue book providing details of where these cuts would come from.
The minister has spoken about expanding the diplomatic footprint of Australia, and she has spoken of opening new posts. That is something that the opposition supports. But the incompetence of this minister in this government is perfectly demonstrated by the manner in which the government went about announcing the opening of a new post in Buka in Papua New Guinea: the foreign minister and the government forgot to properly tell the Papua New Guinean government about this change. And what was the response of the Prime Minister of Papua New Guinea? He said:
We were shocked to learn from the budget documents that Australia was planning to establish a diplomatic post in Bougainville. There has been no consultation on this proposal and there is no agreement to proceed.
This was confirmed by the secretary of the department during estimates a couple of weeks ago, when Mr Varghese said in response to a question from Senator Wong:
If we had our time over again, Senator Wong, I think we would have done this differently.
That is the view of the head of the Department of Foreign Affairs and Trade about the approach that this minister and the government took to announcing the opening of a new post in Papua New Guinea—one of our most important regional neighbours. My final question to the minister is: can the minister explain how she managed to embarrass Australia and cause offence to Papua New Guinea through the budget announcement of a new post in Buka in Papua New Guinea?
I find it somewhat rich for the former Parliamentary Secretary for Pacific Island Affairs to talk about our relations with Papua New Guinea. After all, it was his then foreign minister Bob Carr who declared that sanctions would be an appropriate imposition on Papua New Guinea, which made him and the Labor government a laughing stock in Papua New Guinea. And this was the member who claimed expertise in the Pacific because he swam in the Pacific Ocean. As for his confected concern about Bougainville, his press release could not even extend to the correct spelling of Bougainville, so I am not going to take any lectures from the former parliamentary secretary on this issue.
The fact is Labor have a real problem when it comes to the aid budget because the shadow foreign minister has given a guarantee that Labor will find $18 billion to put into the aid budget. Now this member comes in and says it is $11 billion, so he has committed Labor to an $11.3 billion investment in addition to the current aid budget. I ask the member for Kingsford Smith: where is he finding the $11.3 billion, or where is the shadow minister for foreign affairs finding the $18 billion that they have now guaranteed will be reinvested in the aid budget? I would like to know which programs in health, in education, in defence, in security and in intelligence would be cut to find $18 billion or $11.3 billion—obviously the member for Kingsford Smith is embarrassed by the figure of $18 billion that the shadow minister has committed him to, so he has undermined her and said it is only 11.3.
In 2015-16, Australia will spend $4 billion in official development assistance. That makes us one of the most generous aid donors in the world. We are reforming the aid program to ensure that it is responsible, affordable and sustainable. In June 2014 I launched a new aid policy, the new aid paradigm, to ensure the aid program had a clear mandate to promote economic growth and to reduce poverty in our region. We do not throw money at other countries to buy their votes for a seat on the Security Council; we focus on performance. I also announced new performance benchmarks to ensure we are delivering an efficient and effective aid program, to assure Australian taxpayers of the value of our investments.
In the 2015-16 budget, aid allocation will be informed by rigorous analysis of the contributions that Australian aid makes to partner country GDP, the global ODA flows and the growth trajectories of recipient countries. It is the first time that such an analysis has been applied to the aid program. Of course Australia will continue to invest significant funds in the Pacific: it is our region, and this is where our focus lies. This reflects the particular development challenges facing Pacific Island countries, including geographic isolation, and Australia's responsibilities as the region's primary aid donor and as a partner of choice. Our humanitarian and emergency relief funds will allow Australia to respond to development and humanitarian challenges, such as Cyclone Pam in Vanuatu.
In the Pacific, Australian aid continues to make up a considerable proportion of the gross domestic product of small island states—around 25 per cent in Tuvalu and 18 per cent in the Solomons—but, as we pointed out, in the fast-growing Asian economies to our north, they have grown 6.3 per cent or thereabouts every year over the past decade. Indonesia's economy, for example, has grown by 70 per cent since 2004. Indonesia is now the 16th-largest economy in the world and is on track to become the 10th-largest economy; therefore, our aid is in fact less than 0.1 per cent of their GDP. Indonesia have made it quite clear that they want trade and investment with Australia, not aid. We do not have a donor-recipient relationship; we have an equal economic partnership with Indonesia. And recent history shows that stronger economic growth is the most powerful driver for lifting people out of poverty. Thailand, in 2003, asked Australia not to send any more aid; they wanted trade. We signed a free trade agreement. Trade is now $18 billion between Australia and Thailand. These countries want trade, not aid.
The member made some comment about our commitment to transparency. He obviously has not read his brief. The Australian government reports detailed aid data at the project level on a quarterly basis through the International Aid Transparency Initiative.
An opposition member: Why are you cutting the blue book? You are cutting the blue book. What have you got to hide?
We supplied this information on 10 June. You obviously have not read it.
An opposition member: What have you got to hide?
Get up with the game. This is more detailed information than was ever provided in any blue book. If Labor is concerned with transparency, outline where you are going to find the $18 billion that the shadow minister for foreign affairs has promised will be put into the aid budget.
I call the honourable member for Lindsay.
Thank you, Deputy Speaker. My question is to the Minister for Foreign Affairs—
Point of order!
Excuse me. Please halt.
I was on my feet. The call alternates.
Ms Julie Bishop interjecting—
We had a speaker there and then the call goes to this side.
The DEPUTY SPEAKER interjecting—
A government member: No, don't try that. He did it last time. How about it's our turn.
Well—
Point of order, Mr Deputy Speaker. The way that it works under standing order 65—
A government member: That is not the way it works.
You struggle to find the chamber, okay? So let's not have rulings. The call alternates.
A government member: He is being a bully.
The call alternates.
A government member: You're being a bully.
I am not. The call alternates.
An opposition member: Do you want to be the chair?
A government member: I am not in the chair.
An opposition member: Exactly right.
A government member: I was mouthing off like you guys do all the time.
The member for Lindsay will proceed and then you will be the next.
Under standing orders, the call goes to—
A government member: The Speaker has spoken. He's made his ruling.
The call goes to the alternate sides when there is more than one person jumping—
And the last question was from the member for Kingsford Smith.
The member for Kingsford Smith was the last questioner.
No, it is not questioner. It is speakers.
An honourable member: Do not argue with the Speaker. Make a ruling.
It is speakers, and this is an incorrect ruling, Mr Deputy Speaker.
There hasn't been one from our side, so just let her ask. You are wasting time.
Are you going to speak for the whole five minutes?
It depends what the question is.
I have a very important question to ask.
Member for Grayndler, please resume your seat.
Could I have the full five minutes on the clock, please?
Yes, please.
My question is to the Minister for Foreign Affairs. I would refer the minister to the Australian flagship policy, that of the Colombo Plan. I would like to applaud the minister for her advocacy for this wonderful program and what that has meant for so many young people right across Western Sydney. According to the strategic direction statement in the 2015-16 Foreign Affairs and Trade portfolio budget statement:
The New Colombo Plan is deepening Australia's relationships in the Indo-Pacific by offering undergraduate students opportunities for scholarships and grants for study and internships/mentorships in the region.
A crucial component of the New Colombo Plan is the focus on internships and mentorships. Under the program, students will directly benefit from the opportunity to live, study and work abroad, deepening their understanding of our neighbours and forging friendships and professional connections that will last a lifetime.
We have entered into a new world of trade and economics, and this government is giving students the opportunity to develop those skills as part of the program so they too can break into the international market or pursue a career of their choice internationally. The opportunity was freed up by the Abbott government after securing free trade deals with China, South Korea and Japan. Also, students' knowledge of overseas markets from studying abroad will help us as a government to continue our relationship with the Indo-Pacific region.
To add, the minister visited Western Sydney—in fact, she visited my electorate of Lindsay—where we went to the University of Western Sydney. In February we were able to celebrate the success of more than 190 UWS students who had received grants and scholarships under the New Colombo Plan to travel internationally to more than 38 nations in the Indo-Pacific region. UWS students are travelling to countries such as Thailand, Japan and Singapore, where they take internships or conduct various projects that range from clinical placements in hospitals to working on sustainable development and community business projects run by NGOs.
The University of Western Sydney Vice-Chancellor, Professor Barney Glover, said expanding the university's international horizons is a strategic priority for UWS. He would also like to see increasing numbers of students studying internationally and developing a deeper engagement with our region. He went on to say:
The experiences and relationships we forge through education permeate, inform and shape our future endeavours.
Spending time overseas to study is a life-changing experience, and the positive impact of initiatives like the New Colombo Plan will be felt for years to come.
I was honoured, as part of my MBA program with AGSM, to in fact do one of my subjects in Hong Kong. It was international marketing. That experience has really helped me a lot in my own career and with my own experiences. Deputy Speaker Goodenough, you have lived and worked overseas, so I am sure you can also appreciate why these are amazing opportunities for young people.
The vice-chancellor went on to say:
In addition to the vital scholarly experience, students forge friendships and connections, develop leadership skills, and gain a first-hand understanding of another culture, which is invaluable for their future careers.
This is an opportunity that is guaranteed to enhance our students' personal and professional lives, long after they return home.
The Indigenous student that the minister and I met, Jasmin Hammond, is completing a Bachelor of Natural Science (Environment and Health) at UWS and spent a year abroad in Hong Kong as part of the Colombo Plan. She is also the first Indigenous Australian to be awarded one of these scholarships. She said her time at Hong Kong's University of Science and Technology was a formidable experience as she adapted to a home city of some seven million people. She studied chemistry and physics, which will be counted towards her degree here in Australia. Most importantly, while she was there she decided to also study medicine. The experience in Hong Kong was such that she decided to transform her life, so much so that she has been accepted to study a double degree: a bachelor of medicine and a bachelor of surgery. Jasmin came from a country town, and I would like to ask the minister: can the minister provide advice on the opportunities that are available for Australian undergraduate students in 2015-16, particularly those students in Western Sydney?
A point of order, Mr Deputy Speaker. I understand that you have ruled that we will break with the convention that is clearly there in House of Representatives Practice and the standing orders, that the call will alternate. What we are seeing here, therefore, is one question every 20 minutes, because you have a five-minute response, a five-minute dorothy dixer and then a five-minute response before anyone in the opposition gets the opportunity to ask questions.
The mistake in the ruling is confusing this consideration in detail process with Senate estimates. This is not the same process as Senate estimates, which is why the opposition is therefore having to sit through 20 minutes for each question that is being asked, so in this it makes about three. Could I ask you to seek from the Speaker a ruling for future consideration in detail processes on whether the call will indeed alternate or whether we will have a genuine process of question and answer. I respect the ruling that you have made here but, with respect, your ruling is wrong and is against the standing orders and the House of Representatives Practice. I would ask you to seek from the Speaker a ruling and for her to report after question time today on what that would be.
With the assistance of the Clerk, I will do that.
I note the member for Lindsay's great interest in the New Colombo Plan, which will be a transformative initiative for generations of young Australians. I am pleased that the member mentioned our visit to the University of Western Sydney's Penrith campus last February. We had a very good New Colombo Plan event and got some marvellous feedback from the students in her electorate.
In answer to her direct question about the budget, I can confirm that the government will spend around $28 million to support Australian students through the New Colombo Plan in 2015-16. This year in particular the New Colombo Plan will support around 3,200 students through scholarships and mobility grants. In 2016 the government will offer around 100 scholarships and around 4,750 mobility grants. What this means—and I know the member for Lindsay and the member for Solomon will be interested in this—is that this will take the total number of students supported through the New Colombo Plan since the pilot program began in 2014 to around 10,000 students by the end of 2016. So in two to three years it will be almost 10,000 students.
The member for Lindsay referred to the University of Western Sydney. They have been an enthusiastic supporter of the New Colombo Plan, and I thank the member for Lindsay for the engagement that she has had with the university in encouraging students to apply for New Colombo Plan scholarships and mobility grants. In many instances, the students receiving these grants and this funding have never been overseas, no member of their family has been overseas and they have not had the opportunity to study in our region.
Since the New Colombo Plan was established two years ago, I can confirm that 186 Australian undergraduate students from the University of Western Sydney have been supported to live, study and work in our region under the New Colombo Plan. That is 186 from the University of Western Sydney. This includes six students who have received the prestigious year-long New Colombo Plan scholarships.
Timothy Mann was a 2014 scholarship recipient. He is currently studying biological and molecular biological sciences in Japan, and he will be doing an internship at the RIKEN Brain Science Institute. Another student from your electorate, Member for Lindsay, Candice Skelton, has studied biology at the Chinese University of Hong Kong. According to Candice, her New Colombo Plan experience allowed her to 'grow as a person and to see life through a new perspective'.
The remaining 180 students have benefited from New Colombo Plan mobility grants that support shorter and longer term study, internships and practicums in the region. The member for Lindsay will be interested to know 20 nursing students travelled to Thailand to study healthcare delivery in remote districts including during a short-term practicum with Chiang Mai University and Om Goi hospital. There are 15 development study students who are travelling to India to volunteer at a non-government organisation focusing on the advocacy and rights of people with intellectual disabilities, and 15 social science, community development, planning and tourism students who will travel to rural communities in Vietnam to examine issues relating to poverty and climate change.
All these students are having the opportunity to study and work in one of 38 eligible locations from India and Pakistan in the west, to Mongolia in the north and the Cook Islands in the east. In recent months I have launched the New Colombo Plan in Thailand, Tonga, the Cook Islands and Kiribati, and I can tell you it is an enormously successful exercise in soft power diplomacy. It has been raised positively by President Xi Jinping of China, President Tan of Singapore and Prime Minister Abe in Japan. They have all raised the New Colombo Plan as an example of this government's commitment to soft power diplomacy at its best. The New Colombo Plan will also benefit the individual students by giving them new insights, new skills and new ideas that will enhance our country's productivity and prosperity.
Opposition members: Hear, hear!
I thank the members opposite for their cheers, because this is a bipartisan initiative that receives incredible support across the board. No wonder they want to be on board with this one, because it will build a generation of friendships, connections and professional networks between Australia and the region. The benefits of the New Colombo Plan were emphasised by Singapore's President Tony Tan when he said:
I am confident that the New Colombo Plan will play an important role in strengthening our education and people-to-people ties. The New Colombo Plan also reflects the Australian Government's broader focus on enhancing its engagement with Asia.
So I thank the member for Lindsay for her very pertinent question about supporting Australia's youth and engaging in the region. (Time expired)
In the absence of the tourism minister, who I understand is on sick leave, I have some issues on tourism to raise with the acting minister. The first issue is the backpacker tax that has been brought in. Some 134,000 working holiday visa holders per year will lose the tax-free threshold of $18,200 at the moment, increasing from 1 July. They stay some eight months on average and they earn on average $5,000, but the point is they spend $13,000 while they are here—a net gain of $1.3 billion to the economy. I am wondering what modelling the government did, prior to this change, on the economic impact, particularly on regional areas. The minister would be aware that, in many regional areas, the tourism sector relies upon this workforce. The point is: not only do they contribute indirectly by making sure that those tourism hotels and facilities are able to operate where there is a shortage of what is often seasonal labour but they also spend the wages that they earn in the local economy while they are there. We have not seen any modelling from the government on that issue.
The second issue is the survey of tourism accommodation, which remains under a cloud. I believe very strongly that the sector is right in asking for this survey to be reinstated. To take one example, Dianne Smith, the CEO of the Victoria Tourism Industry Council, said:
This will severely hamper the industry's ability to learn, grow and realise its potential.
One of the roles of government is to provide that evidence that forms the basis of good policy. It seems to me that this is a very short-sighted approach.
The third issue, and one that is also within the foreign minister's portfolio, is the decision to withdraw from the United Nations World Tourism Organization. For a relatively small amount of investment, Australia has lost its place at the table in engaging in its region through this organisation. The fourth issue is Australia Week in China this year. Will it be held? If it will not be held, why won't it? Surely this is a common sense position that is important for us to support.
There is, of course, less funding for Tourism Australia in the budget. Our most important marketing body generates some $16 returned to the economy for every dollar spent. The government has cut funding in real terms each year since being elected. The Parliamentary Library, in a paper that has been produced, described the cuts as significant. With the tourism grants cut for round 2 of the Tourism Industry Regional Development Fund, some 450 applications were submitted. They lost, therefore, $10 million of matching private investment in the process. Also, will the government reconsider its views toward the axing of all domestic marketing of tourism here in Australia? The last issue, but certainly not the least, is: for the first time in more than 40 years Australia has no designated tourism minister. John Key, the New Zealand Prime Minister, is also the tourism minister. The New Zealand government recognises the importance of tourism. Will the government consider appointing someone with responsibility for tourism?
In conclusion, it is pretty clear that tourism is a super growth sector for the Australian economy. It contributes $107 billion to the national economy. Every dollar spent in tourism generates another 92c in other parts of the economy. I feel very strongly that the government needs to take tourism seriously and not just have it as an afterthought.
I have to say it is ironic to receive a question on tourism from Labor. Labor did not even bother taking a tourism policy to the 2013 federal election. Labor cut funding for Tourism Australia and then it imposed the passenger movement charge with two separate increases occurring without warning—a $55 tax levied on each passenger, which was an increase of a total of 45 per cent under Labor. Labor increased tourist visa fees by more than 50 per cent. The world's biggest carbon tax cost the Australian accommodation sector $112 million in its first year; it reduced hotel profitability by 12 per cent. And Labor strangled the temporary skilled migration program at a time when tourism and hospitality businesses were desperately struggling to find skilled labour. It would be amusing if it were not so serious.
Our tourism industry achieved record results in 2014, with international expenditure up nine per cent to an all-time high of $30.7 billion and our tourism investment pipeline growing by nine per cent. A recent World Economic Forum report shows that the global ranking of competitiveness for Australia's tourism sector has improved from 13th in the world under Labor to seventh in the world this year. We have made a strong start supporting tourism, but of course there is more to do.
Deloitte has recognised tourism as one of only five sectors set for supercharged growth in coming decades, and the opportunities are immense. One hundred million Chinese people went on an international holiday last year. This will double to some 200 million outbound Chinese by 2020. The elevation of tourism to the cabinet table, by bringing tourism into its natural home in the Department of Foreign Affairs and Trade, was a conscious decision that we made in recognition of the sector's importance. The 2015-16 budget provided $36.7 million over the forward estimates in additional funding to Tourism Australia to support marketing activities abroad. This is the result of new foreign exchange arrangements that see Tourism Australia compensated for a weaker Australian dollar, consistent with the Foreign Affairs and Trade portfolio partners. In response to this, the Australian Hotels Association said:
The Federal Government is to be commended on today's announcement and recognition that tourism is a key player in international commerce …
Similarly, the Accommodation Association said:
The funding pledge will assist with ensuring Australia is able to continue to compete in the aggressive global market for international visitors.
So, this is all good news.
Other key budget outcomes for tourism that, obviously, the shadow minister overlooked are $30 million to increase promotion of foreign direct investment in priority areas, including tourism infrastructure; and $18 million to expand the series of Australia Week trade and promotional events in China, India, the US and ASEAN, promoting Australia as a world-class tourism destination and a valued trade and investment partner. As is publicly available information, Australia Week is held every two years.
The budget builds on the government's recent support for tourism, which includes striking a landmark air services agreement with China and freezing the passenger movement charge that increased 45 per cent under Labor. I can tell you that the tourism industry is delighted by the fact that we froze the passenger movement charge that Labor increased twice, without warning, to 45 per cent. We have announced three-year multi-entry visas for approved tourists and business applicants from China. We are launching pilots for online visitor visa lodgements for China and India, with a full rollout by the end of the year.
In particular, I wanted to mention working holiday makers—the backpackers. I will forgive the shadow minister for not understanding this: backpackers are currently treated as residents for tax purposes, but they are not residents. They should not access the tax-free threshold. The decision to remove the tax-free threshold for backpackers is all about tax consistency, something that Labor would not understand. This measure is closing a loophole; it is not applying a new tax. I do not expect those opposite to understand this, because they have never seen a tax that they do not embrace. I am sorry, but this is a loophole; it is not a tax. Backpackers make use of services and amenities funded by Australian taxpayers, so it is only reasonable to get them to contribute towards these services while they are in Australia.
The measure will not undermine our working holiday program. Indeed, given that many backpackers in Australia do not even make use of the residential taxation provisions, this move is not expected to have a significant impact at all on demand for these visas. Research from Tourism Australia indicates that backpackers choose to come to Australia primarily for cultural and leisure purposes. We are a lifestyle superpower on the world stage, and taxation arrangements are not the major driver of their travel in any respect.
We have a proud record of supporting working holiday makers in Australia. Unlike the ACTU, the bosses of those opposite, we do not demonise backpackers— (Time expired)
I refer the Minister for Foreign Affairs—
Mr Deputy Speaker, can I have the call?
The member for Solomon has the call.
I am seeking the call.
The member for Solomon has the call.
to the strategic direction statement in the Foreign Affairs and Trade portfolio—
Mr Thistlethwaite interjecting—
budget statement, which states:
Gender equality and women and girls'—
Mr Thistlethwaite interjecting—
Can I continue?
Yes, please.
Can I have the clock restarted? Thank you.
I refer the Minister for Foreign Affairs to the strategic direction statement in the Foreign Affairs and Trade portfolio budget statement. It states:
Gender equality and women and girls' empowerment will be addressed across the aid program.
As the minister is aware, this year marks the 20th anniversary of the Beijing declaration and platform for action, an agreement adopted by the nations of the world to advance gender equality in 12 critical areas of concern. This important document was the focus of this year's session of the Commission on the Status of Women at the United Nations headquarters in New York. It reflected on the progress that has been achieved and the challenges that still lay ahead. The Minister Assisting the Prime Minister for Women, Senator the Hon. Michaelia Cash, and the Australian Ambassador for Women and Girls, Natasha Stott-Despoja, attended the commission to advocate for renewed international commitment and momentum towards gender equality. Twenty years on, gender inequality persists in our region, undermining economic growth, human development and poverty reduction. The anniversary has placed women's empowerment front and centre on the global agenda with policymakers, political leaders, technical experts and gender advocates driving renewed political will and commitment.
The evidence is clear: gender equality is critical to development and must be a key part of Australia's aid program. I am pleased that the government's new aid paradigm released last year—Australian aid: promoting prosperity, reducing poverty, enhancing stabilityplaces gender at the heart of our aid program. The document highlights the alarming rate of domestic violence. One in three women in South-East Asia and two in three women in some Pacific countries experience physical and/or sexual abuse by their partner. It is estimated that the Asia-Pacific region is losing up to $47 billion annually because of women's limited access to employment opportunities, and up to $US30 billion annually due to gender gaps in education. This statistic is alarming to me as a woman and particularly so as the member for Solomon. My electorate is one of Australia's most multicultural communities, with vibrant Asian and Pacific communities. In the time it takes me to travel from my electorate south to Canberra, an equivalent trip north would reach eight international capital cities, 36 trade ports, 69 international airports and nearly half a billion people. To put it simply, what is good for Asia is good for Solomon. Economic growth in Asia means jobs in north Australia. Economic empowerment in South-East Asia and the Pacific means markets for our goods, skills and produce. Given this statistic, how is Australia's aid agenda prioritising women's empowerment? How will the Abbott government assess the performance of our aid program in addressing gender inequality? In the foreign minister's speech on the government's new aid paradigm, she states:
Globally the private sector generates 90 per cent of jobs and funds over 60 per cent of investment. A strong private sector delivers higher growth, more jobs and will help reduce poverty.
According to the strategic direction statement in the portfolio budget statement:
DFAT will strengthen the aid program’s engagement with the private sector and its promotion of the empowerment of women and girls.
Minister, how is the Abbott government embracing the private sector to advance gender equality?
I thank the member for Solomon for her support of the Australian Government's commitment to promoting opportunities for women and girls and for her question. I know that she has worked very hard to support women and girls in her electorate of Solomon and in the Northern Territory. As she rightly notes, the government's new aid paradigm reflects our strong commitment to empowering women and girls in our region. That is why we have prioritised initiatives that enhance women's voices in decision-making, leadership and peace-building initiatives; promoting women's economic empowerment; and, importantly, ending violence against women and girls in our region. Gender equality contributes to growth, development and stability. When women are able to actively participate in the economy and in community decision making, everybody benefits. So gender equality is one of the six investment priorities of the aid program.
In the 2015-16 budget I established a $50 million competitive gender equality fund. This is the first time this has been done. The fund will support initiatives that advance gender equality and foster innovative work by private sector and non-government organisations, particularly women's organisations. The fund will continue Australia's contributions to influential global initiatives such as the United Nations' work to end violence against women. It will also preserve important initiatives such as Pacific Women Shaping Pacific Development. That initiative supports improved political, economic and social opportunities for women across 14 Pacific island countries. But initiatives supported under the gender equality fund will complement gender activities currently funded through country and regional programs.
We know that a strong private sector delivers higher growth and more jobs and will reduce poverty. So if we can find a private sector solution available that is efficient and effective we will embrace it. I have announced a new $15 million partnership with the World Bank to enhance women's economic empowerment in South-East Asia over the next four years. We will work with the World Bank and the private sector to support women entrepreneurs to access financial services and build their business skills. This partnership will see us work with large companies to improve employment opportunities for women, improve their workplace policies and increase the use of services provided by women entrepreneurs in their supply chains. I know that the member for Lindsay and the member for Solomon understand the skills required for women entrepreneurs. This investment will improve knowledge of the ways to increase women's economic opportunities and apply those lessons to the design of programs. We are going to do it through a South-East Asian gender lab, which will undertake data collection, analysis and evaluation of the impact that programs will have.
Australia's investment in women's empowerment through practical programs supports our international commitments, including at the United Nations Commission on the Status of Women. Last month in Pakistan I announced a skills training program for marginalised women and girls. The program will support 5,000 women and girls in remote areas to develop skills suitable to the local job market and to access finance to establish small businesses—because, as we know, in Australia and elsewhere small business is the driver of economies. In the Pacific, Australia and Papua New Guinea have agreed to a five-year plan to promote gender equality. I know that the member for Solomon is particularly interested in our initiatives with our close friend and neighbour PNG. The plan, delivered through an Australia-Pacific women's development initiative, will focus on creating leadership and economic opportunities for women. It will coordinate the efforts of government, the private sector, NGOs and community groups to pilot new and innovative approaches to help prevent violence. These are just two examples of how the Australian Government is providing practical support to women and girls in developing countries and therefore driving economic growth, which provides job opportunities and sustainable communities.
Question agreed to.
I move:
That debate be adjourned and the resumption of the debate be made an order of the day for a later hour this day.
Question agreed to.
Sitting suspended from 13:33 to 15:58
In relation to this year's budget, in particular the Youth Employment Strategy, intensive support and Youth Transition to Work, I note that $212 million will be—as it states in the budget—provided over four years to establish a new support service. The questions that I have of the minister or, indeed, either of the ministers—whoever feels responsible to answer this particular question—are as follows. Firstly, where is this money coming from? Is it new money or is being reallocated from existing expenditure? Is it from the Department of Employment? Is it arising from the department's budget allocation? If so, is it offset? If not, where has the money come from? Has it been offset? Is it new money? I think these are important things for the public to know. Clearly, when the government announced this and when the Treasurer on budget night presented this particular initiative, the impression was left for those listening that this was a measure that was above and beyond the existing expenditure. I think it is important for the government to explain fully where they have funded this amount of money.
I note also that funding will be provided to a network of community-based organisations to deliver the support. In doing so, we ask for some answers to the following questions. How will the organisations be selected in terms of the network of community-based organisations? Is there a tender process or is it by way of another process? When will the selection process begin, if it has not already? How many organisations does the government estimate will bid for such a service? Which areas or electorates will these services be provided to? How will the government determine those areas? Also, when will those areas be known to the public?
The government, as we know, abolished what we would argue was a very successful program—Youth Connections. In fact, as a local member and as the shadow minister for employment, I have received many submissions from interested parties about the loss of that program. In light of the loss of that particular initiative, which I think was really showing some great success in terms of connecting young people to the labour market, we ask the following questions. How does this program that I have just referred to differ from Youth Connections? Was any analysis done between Youth Connections and this program? Youth Connections, for example, assisted 25,000 people per year. How many does this program support? Why did the government not re-establish Youth Connections given its obvious success?
Finally, the government refers to its program as assisting 'disengaged young people' who are between the ages of 15 and 21. How did the government arrive at that age category, given that the definition of people who are unemployed under the definition of young people is different to that? Was any modelling done? Is the government targeting a certain age range within the 15 to 21 bracket? How long will a participant be involved in the program? Will the participant receive support after completing the program? How, if at all, does this program interact with the government's National Work Experience program? How will it be determined who is in the program?
I note that this particular program is designed to support people who are at high risk of long-term unemployment and welfare dependency. As a result of that, I ask what measure it is that will be used to determine if the people are at high risk of long-term unemployment. Can people who have already been considered to be long-term unemployed access the program once it is initiated? These are some of the questions the opposition has of the minister. We invite the minister to respond to those questions.
I am pleased to speak on the issue of the Youth Transition to Work program. I can reassure the shadow minister not only that we are investing $6.8 billion in a new Job Active employment services system, which is going to deliver better services to job seekers and better services to employers, but also that this program forms part of our $330 million youth employment strategy. The member will be pleased to hear that it is new money. It is money from the budget. It is additional funding to Job Active. It is part of our commitment to help young people from welfare into work.
The good member asked about the issue of the selection process for organisations to be involved in this. We are currently looking at options for the most efficient, effective way in which we can select participants to deliver the services under the transition to work program. I am certainly taking views from community organisations on the design and final details of the program we have in mind. It is a program that has a different focus from Youth Connections. This program has a focus on getting young people actually into work. That is the very important difference. The cohort of young people who will participate in the transition to work program will be selected on the basis that, with appropriate services and appropriate wraparound services—with the types of services that will be delivered under this program, such as mentoring, coaching and pre-employment training—we will be getting them to the point where they can make that important journey from the first rung of the ladder into employment.
It is vitally important that we do not continue the age-old process of endless training for training's sake—endless courses that were not delivering the important job outcome that we as a government want for our young people and that young people want themselves. There is nothing more debilitating for a young person than to participate in a program only to find out on exiting that program that there is no future coming out of it. So we are about a program that will deliver a job. Youth Transition to Work is an important part of that strategy. It does it in a number of ways. As I said, there is mentoring and coaching. Communications skills development—how a young person is going to participate in a job interview and what the employer is expecting of that young person—will give the young person confidence to go to a job interview and to know that they will have the support they need to get by in the workforce. Literacy and numeracy skills for those young people who need it are vitally important. Also teamwork skills—important new skills. And there is access to work experience. Transition to work will fit in with a suite of programs to deliver a total service that will get more young people into work.
Another service that the program may be providing for some young people in certain circumstances, and one that I know will be popular with many young people, is assistance in some cases to get a drivers licence. For many young people the lack of a drivers licence can be a major impediment to getting into work. Also there is support for young people in taking up apprenticeships. It is a wide range of measures as part of a wraparound service targeted at young people who may not necessarily get the job they need through the conventional assistance that is offered under Job Active. This is a supplement to Job Active. A young person who participates in transition to work will be deemed to be completing whatever mutual obligation requirements that young person has. It is a great new program. It is one that has a work focus—as opposed to Youth Connections, which lacked a work focus. That was a major criticism of that program. At the end of the program the young person was not necessarily any closer to getting a job. We are overcoming that barrier. We have a work focus. We have a program that will use community groups to deliver outcomes and deliver support for young people. We will be looking at placing programs in areas where we can have that continuum: entering the program, being assisted and having their confidence built with a view to, at the end of the day, an employer being available that will be able to offer a job outcome to young people. It is all about getting people on that journey into work. Work is vitally important. This is a work-first approach in transition to work. We have thought this through very carefully. We are consulting widely with community groups to deliver the program. It will be, I think, a game changer for many young people.
Minister Hartsuyker: as you know, my electorate has one of the highest unemployment rates in the country. The unemployment rate for Hinkler is 10 per cent, and for the broader wide Bay region it is 13½ per cent. The youth unemployment rate among 15- to 24-year-olds in my region is 20.6 per cent. Unlike those on the other side, I recognise that it is businesses that create jobs, not governments. The businesses that I speak to all say they are willing to train people but are concerned that not enough of the job seekers they meet are work ready. They do not have the required soft skills, like turning up on time and dressing appropriately. On the other side of the coin, job seekers say they struggle to get a foot in the door to get some much-needed experience in the workplace. As I am sure you are aware, Mr Hartsuyker, we have had great success with the Work for the Dole program—some fantastic success with that program.
Opposition members interjecting—
Well, I will give you a good example. We have interjections from the other side, but I will give you a great example from the former Hervey Bay mayor, Ted Sorensen, the now state member for Hervey Bay and a fantastic man. He is a good local member and has been for at least two terms down there and many years as the mayor. Ted's advice is that in his time as mayor the Work for the Dole program worked exceptionally well. It brought young kids in, it gave them experience and it gave them the things they desperately need in order to get a job. And the first one of those of course is soft skills. The employers I meet with—and I have to tell you, Assistant Minister, it is all the employers I meet with—have real challenges identifying people inside our electorate who have the basic skills: turn up on time, be dressed, be work ready, be willing to leave your phone behind and not have it with you 24/7, have the ability to show up every single day, not just on occasions when it might be appropriate for you, to come to work and enjoy work and have the skills needed to show up.
The other thing Ted spoke about, and he spoke about it often, was the great advantage they got from learning additional social skills. They are able to work with new colleagues. And life skills: to be able to work with more people, people who are actually in the workforce and who have things they want to transfer. This knowledge transfer is incredibly important. It is something I spoke about in my maiden speech. We are losing the skills from our experienced workforce, and they are not being transferred across to the current generation. We need to ensure that we transfer those skills. Ted spoke about all of those things, but the most important thing for the mayor of Hervey Bay was that many of the people who were involved in Work for the Dole got a job. They got a full-time job after they completed the program, and a number of them with council, with local government. It is a fantastic outcome for them, and as far as I am aware they are still there. The skills they learned in Work for the Dole, working for council, gained them employment. So, they are very, very important skills.
It is important that we identify that Work for the Dole has worked so far. It has been great. I also appreciate the fact that the minister has been to my electorate three times. I am fairly certain that those in the opposition do not even know where my electorate is. But the minister has come up to have a look and gain some real first-hand experience—three visits, which has been fantastic. We have been to an organisation called WeCareToo, which was using the Work for the Dole program to help the local community. They are a food bank—
An honourable member: Famous for its whales.
Whales, seafood—many things. But they are helping the local community through Work for the Dole. They provide experience for a food bank that helps people who cannot afford to purchase food. That is their role. It is a fantastic outcome.
Building on the success of Work for the Dole in giving people real-world experience, the 2015 budget included funding for a national work experience program, which is something different. Can the minister please advise how job seekers and employers in my electorate and indeed elsewhere in the country—almost as important as my electorate!—will benefit from the national work experience program?
I thank the member for his question, and let me say that he is indeed a member who is in tune with the needs of business and a member who cares passionately about the subject of employment, particularly generating opportunities for young people. The good member raised the issue of Work for the Dole, and I was pleased to be able to host that in his electorate, one of the 18 regions in phase 1 of Work for the Dole. It has been very successful, and the good member noted the comments of the member for Hervey Bay, Ted Sorensen, about the importance of Work for the Dole.
The insight the good member has given in relation to the importance of those soft skills is shared not only by employers in the electorate of Hinkler but also right round the country. In a survey of over 3,000 employers by my department, in their responses employers were saying that the best thing young people could do to improve their prospects of getting a job was to improve their attitude in the workplace and the way they present in the workplace. Work for the Dole has an important role to play in giving young people those important soft skills that the good member referred to, such as turning up on time, being dressed appropriately, knowing how to treat customers in a business and knowing how to get on with your workmates. They are skills that we who have been in the workforce for many years take for granted but regrettably they are skills that some young people, who perhaps have not seen anyone in their family working, do not have.
I am pleased to advise that Work for the Dole goes national on 1 July as part of the $6.8 billion Job Active program—a huge investment in getting people from welfare into work. Work for the Dole goes national, giving young people some important skills to assist them on the first rung of the ladder of getting into the workforce. Work for the Dole is not a policy in isolation; it is part of a broader suite of measures. As part of this year's budget we have introduced the National Work Experience Program, which will give people four weeks work experience, probably in a commercial environment, which will allow young people to demonstrate to an employer the sorts of skills that they can bring to a workplace. It will allow a young person to demonstrate to an employer exactly what they can do, that they are up to the job, that they are keen, that they are willing and that they are supported by an employment services system into that role. It is part of a continuum, because supporting the National Work Experience Program we have a range of flexible wage subsidies.
A likely pathway that a young person could have for getting into work might be starting in a Work for the Dole placement and showing his Work for the Dole supervisor that he is keen, that he wants to work and that he turns up every day on time, and as a result being offered a work placement by his employment service provider to get in with an employer for a four-week period. At the end of the four-week period the potential is there for eligible job seekers to have a wage subsidy to help them—a wage subsidy of up to $6,500 to help the employer offset the costs of bringing in that new person. So we see a very clear pathway which potentially integrates Work for the Dole but not necessarily. A young person could go straight into the Work Experience Program without having done Work for the Dole, but it would be a likely pathway: Work for the Dole through to work experience through to a permanent job. Isn't that a great outcome? It is the sort of outcome that the government wants to see.
It is very much part of our strategy of getting people into work where we have a very flexible system. We had a system under Labor, under the old Job Services Australia, that was mired in red tape and bound up in bureaucracy. It was a terrible program to the extent that there was far too much red tape and that red tape was hampering employment service providers getting people into work. We are getting rid of that red tape. Job Active continues that process with much less red tape and a much greater focus on outcomes. The outcome that we want is getting people into a job. The outcome that job seekers want is getting people into a job. And the outcome that employers want is having people presenting at the gates of their business with the necessary skills to allow them to get by in that business and contribute to that business. It is a very good program. Work for the Dole is an important part of it, work experience is an important part of it and wage subsidies are an important part of it.
Having listened to the Assistant Minister for Employment run through a number of matters, I am assuming by his response to my earlier questions that he is taking almost all of those on notice. I certainly will be keen to hear the answers on those matters. He did make the point that the money for the youth employment initiatives outlined in the budget was new money. That is surprising to the opposition in light of the budget's own expenses in table 2.1.1, which goes to the forward estimates for expenditure for Job Active last budget compared to this budget.
I just want to place on the record the variations in the forecast of expenditure in the budget this year compared with last year. In the 2015-16 year, expenditure as outlined last year was to be $1,767,184,000. That has gone down from $1.76 billion to $1.45 billion in that time. Therefore, that is a shortfall of about $170 million in that year. I have asked the assistant minister to explain why there has been an alteration in the expenditure for the next financial year.
In the following financial year 2016-17 the original forecast in last year's budget was approximately $1.86 billion. That has come down to $7.7 billion so, again, there is about a $70 million or $80 million reduction in the forecast for that year. I would ask the assistant minister why that would be the case. Also for the 2017-18 year, there is also a further reduction of about $160 million, from $1.93 billion to $1.77 billion, so there have been very significant reductions in the expenditure as forecast by the budget. That is at a time when the budget's own papers forecast unemployment to rise to 6.5 per cent. One of the reasons might have been that the forecast would fall because of the forecast reduction in unemployment, but that is not the case. Unemployment, according to the budget papers, is to go up in the next financial year to 6.5 per cent, a 14-year high. Therefore, that would not account for why you would reduce the expenditure in the new program jobactive. Therefore, I ask the assistant minister to explain exactly why that is the case.
As I am on my feet, I would also ask the minister about some of the matters he raised in his answer to the member for Hinkler. Firstly, wage subsidies. I think wage subsidies can work and sometimes they do work. As I have said before, we support the government if they are able to find successful initiatives that lead to good outcomes. I ask the minister now or perhaps on notice if he does not have all the figures with him, but I would hope he would have them, how those wage subsidy programs are going. Sometimes they are hit and miss; sometimes they work. Given the forecasts that were made about the uptake of those opportunities for employers to subsidise wages to employ more people, we would of course like to see that work. We ask the minister to table or to provide answers as to how those programs are going to date.
In relation to the national rollout of Work for the Dole, again, Labor does support work experience. We do not believe it is the only measure that can work for people who are out of work. We do not necessarily believe that it is the best approach for someone who has been 30 years in the labour market and who may have been retrenched recently. We think that person, to be reconnected to the labour market, is more likely to need new skills. They do not need a work culture. They have spent three decades in the labour market. That is not a person who really needs to know how to work in teams, under supervision and to turn up for work. They have been doing that for many years. But having said that, we do accept that the Work for the Dole programs, if well structured and targeted at the people who do not have a work culture, can be effective. We would ask, insofar as the rollout is concerned, which areas are going to be targeted first in relation to that national rollout.
I thank the shadow minister for his question and take the latter parts of his questions first. The rollout will happen nationally around the country from 1 July. Quite clearly, it will ramp up aggressively in each area, but there will be a national rollout starting in all areas on 1 July. With regard to wage subsidies we have introduced a range of measures to make those wage subsidies more flexible and more appealing to employers. Previously, the subsidies tended to be back-ended and wage subsidies were not paid until later in the employment period. After some very careful consultation with a range of stakeholders it was felt that the more flexible we could make wage subsidies the more appealing that would be for employers.
Take the Restart program, for example, which focuses on people over the age of 50. Restart was, under the previous budget, payable over 24 months, and we have now made that Restart program payable over 12 months. That is a welcome improvement. We are allowing flexibility for employment service providers to negotiate with various employers to come up with a payment structure that is mindful of the importance of ensuring that government revenue is spent wisely but in a way that meets the needs of employers. For example, under the new arrangements the wage subsidies can be paid fortnightly if the employer would like that. The youth wage subsidy was previously paid when a young person had been unemployed for a period of 12 months; it is now payable when a young person has been unemployed for six months, with a view to assisting a young person into work before they get to the point of becoming long-term unemployed. With all of our wage subsidies, as with Restart, there is a degree of flexibility to meet the needs of the employer. The more flexible we can make these wage subsidies, the more effectively they will be taken up.
Another thing we have done is combine all the wage subsidies into a $1.2 billion wage subsidy pool. If the take-up in wage subsidy A is not up to expectations but the take-up in wage subsidy B is heading towards over-expectations, the money can flow—it will be a global budget, basically. Money can go where the demand is. That is another important element in ensuring that we get the maximum utilisation of the wage subsidies.
With regard to the other elements of the question, we are putting more money on the table for employment services than Labor ever did. That is an important point—this is a massive investment. It is a $6.8 billion investment in Job Active; there is a Youth Employment Strategy of $330 million. These are massive commitments by this government to ensure that we get as many people as possible off welfare and into work. We are making our wage subsidies more flexible so that we are getting greater take-up by employers, and that is really important. We are building pathways in the system such as I mentioned earlier, where a person can follow a path through Work for the Dole, through work experience and ultimately into a subsidised position. These are great new initiatives that are going to mean that programs are more effective.
One of the really important things we are doing is strongly focusing on payment for results. We are no longer paying for process; we are no longer paying for training for training's sake; we are no longer paying for, in many cases, training outcomes. We are overwhelmingly paying for getting people into work. The outcome we pay for is getting someone into a job. Employment service providers will get a modest retainer or a modest administration fee to cover the costs of individual people on their case load, but if employment service providers are going to succeed under the Job Active system then they are going to need to build strong relationships with employers so that they will have a supply of jobs that they can put their job seekers into. If they do not have strong relationships with employers they are not going to get the number of successful placements that are required to ensure that a particular organisation will succeed under this new system. We are about a strong, results-focused system. We have stripped down red tape, and we want a more effective system for job seekers and employers.
Few issues can be more important for my electorate and for the future of this country than chronic youth unemployment and skills gaps. Those opposite are always keen to crow about being the party of jobs, the party of employment, but the striking thing for me in the last decade or so has been watching what actually happened in practice. The really striking thing was that in the final years of the Howard government, from 2004 through to 2007, we saw a 13 per cent increase in youth employment rates, but between 2008 and 2013 we saw an eight per cent reduction in youth employment rates. We saw participation rates for people under the age of 25 falling from 71 per cent to 66 per cent. We are at the point now where we have youth unemployment rates of around 12 per cent or more, significantly more in some regions, compared to just under six for the overall economy. This is a very serious problem that we inherited from the previous Labor government and that they failed to address.
The other side of this, though, was the collapse in apprenticeship completions under the previous government. We saw something like a 40 per cent failure rate. That is a very serious problem, particularly when you consider what is happening on the demand side. I was finishing off some work in my office on Friday in Goulburn and a couple of plumbers came in to do some work. I had a chat with them. They were Dean Thompson and Troy Matthews, very good plumbers around Goulburn with a team of about eight. I said to them, 'How are you going for work?' They said, 'We've got heaps of work. In fact, we're going to take advantage of this accelerated depreciation. Lots of other people are taking advantage of that, and our workload is such that we really don't even have to pick up the phone before the calls come in—we don't have to actively market at the moment. It's fantastic. But I tell you what: we can't find apprentices.' We saw the failure of the apprenticeship policy under the last government. They thought everyone should get a university degree; in fact, we need more plumbers. So we have a very serious problem not just with youth unemployment but with matching those skills to the needs out in the marketplace.
These are problems that I know the assistant minister has been thinking hard about and working hard on for a considerable amount of time, and I note some of the initiatives that he has already talked about. Can the assistant minister please advise in some detail what measures are in the budget that will assist young unemployed people in my electorate to find work?
I thank the member for Hume for his comments. He certainly brings great skills to our side of politics and has a strong knowledge of the commercial realities of the Australian economy and the importance of ensuring that we maximise the productive capacity of our young people. We have a broad range of measures under the new Job Active program and under the Youth Employment Strategy that are going to assist young people.
I will start with something that is important in engaging young people. One of the new things that we are doing, over and above the things that I mentioned in my earlier contributions today, is that we are going to be focusing on the Job Active system and the interaction between young people and their employment providers. We are going to talk to young people in their language. We are going to allow them to use IT; we are going to allow them to use text, SMS and electronic means of communication to communicate with their employment service providers. The new Australian JobSearch website will be much more elaborate. It will be much more focused on being better for job seekers and better for employers. It will be easier for employers to post vacancies. It will be easier for young people to search. They will be able to determine where the jobs are virtually by looking at home, without having to go out and walk the streets. There is no substitute for going out and talking to employers if you are a job seeker, but to be able to do some of this job searching more efficiently and more effectively through better IT systems will be an important element that I think will appeal to many young people and increase their interest in getting work. Under the Job Active system, as I said earlier, we have very much a focus on results so that the employment service providers must get that young person a job. They cannot put the young person in the too-hard basket, because, unless they get that young person a job, they will not be getting the remuneration they need to make a profit and keep their doors open.
Supporting the Job Active system, we have a range of measures. I talked about the Transition to Work program—$212 million, offering a range of support through a wraparound means of delivery such as mentoring and coaching, literacy and numeracy skills development, communication skills development, teamwork skills development and access to work experience. We have the wider national work experience program, over and above Transition to Work. We also have $106 million for assisting vulnerable job seekers, and this is very important. There are a range of measures under the assisting vulnerable job seekers program. We have $55.2 million for innovative youth program trials. They will be a range of trials delivered by community-based organisations which will approach the problem of youth unemployment from different perspectives. We are looking for innovation. There are many examples of small projects out there in communities that are highly successful. We are looking at ways we can scale up those successful projects. We are looking for new ideas, potentially, to approach the difficult problem of youth unemployment from a different perspective.
We have $8.9 million of funding in the budget to assist parents into employment. It is so vitally important that we assist young parents. We want to break the cycle of intergenerational unemployment. We have $19.4 million to support young people with a mental illness. Many, many employers can be hesitant in some cases to put on someone with a mental illness. We have to give young people with a mental illness support to get into work and we have to give employers support to take on people with a mental illness, because it is vitally important that we maximise, as I said, the productive capacity of all Australians.
We have $22.1 million to assist refugees and young migrants into work. Many refugees and young migrants face very substantial barriers getting into the workplace. This innovative strategy assisting vulnerable job seekers is approaching the problem from a different direction. It is using much of the expertise that is out there in the community—government partnering with community groups to upscale programs they already have in place and allowing community groups to perhaps put in place a new innovative program that has not been done before. These are exciting opportunities. They aim to assist young people from welfare into work and they are looking at those young people, who might fall through the gaps, with the vulnerable job seekers program, which is going to be one that will open up a range of doors for many young people.
I did ask the Assistant Minister for Employment why there was a very significant reduction in the budget forecast for Jobactive. When I add it up, it is around $400 million. It may well be the case that the contract is longer. It goes for five years and, therefore, over that time there may be increased expenditure. But there is no doubt that there have been some very significant reductions in expenditure forecast in this budget compared to last year's budget—and I really have not had an answer from the minister. Yes, it is the case that there has been a new initiative. It would appear that, unless the minister can account for the reductions somewhere else, the money that has been allocated for the initiatives as outlined by the Treasurer in the budget on budget night have been derived from taking the money from Jobactive. It is the only thing I can conclude. I did provide an opportunity for the minister to explain the shortfall and he has failed to do so.
What I need to put on the record but also ask directly of the government, through this minister, is this: if the government is confident that these initiatives are so likely to lead to success and if indeed Jobactive is better than the preceding contract with the employment service providers, why is it the case that the government's own forecast is for unemployment to rise over the next financial year to a 14-year high?
It would seem to me, contrary to a lot of the rhetoric of the government, including the minister in the last half an hour, that if in fact the unemployment rate is to hit 6.5 per cent in the next financial year, it demands an answer. This government has decided to call this budget the jobs and families budget. For families with a single income of $60,000 a year, it is cutting their income by up to $6,000 a year in family tax benefits. It is calling it a jobs budget, yet jobs are going to be fewer insofar as the proportion of people looking for work because unemployment is rising, according to the budget's own figures. It seems to me, therefore, that something has gone awry here. The government is expecting higher unemployment. The fact is that the measures that have been referred to by the minister are not going to lead to the benefits because there is not going to be a reduction. We are going to see, at the very least, a six in front of the unemployment rate. Six per cent or higher is way too high for this country. Given those figures we really need to hear some answers as to why there has been that failure and why the government is forecasting failure in the area of unemployment.
The other thing I should note, given one of the previous speakers mentioned plumbers and apprenticeships, is that there has been a significant reduction in investment in apprenticeships and training by this government. Indeed, last year's budget saw a reduction. It may be difficult for the minister to answer this because it does not go directly to and might be incidental to his portfolio. I think he should take an interest because it is to do with tools for apprentices. There was an initiative that allowed for tools for tradies to be paid for so they were properly equipped. That was removed and, of course, what was put in its stead was a loan arrangement where young people could enter into loans and go into debt in order to finish their apprenticeships.
I wonder whether the minister would like to comment on how successful that is going, because the last time I spoke to some of the training providers they said that that has not been very well received, there is a very low take-up rate and it has not led to improved completion rates for tradespeople. So notwithstanding the rhetoric not of the minister but of a previous speaker about apprenticeships, it seems to me important for the minister perhaps to reflect upon whether it was wise of the government to remove the payment for tools for apprentices and put in its stead a loan arrangement which has not been taken up by apprentices and is not therefore creating the opportunities to see greater completion rates for apprentices in the trades. That is something else that we would like an answer to. (Time expired)
I can say that I bring good news. On the unemployment front we saw very welcome figures. Whilst one must always be cautious in interpreting employment figures, the most recent employment figures showed a reduction in the unemployment rate to six per cent. We certainly want to get it lower. The aim of Jobactive is to get as many people into work as possible. The aim of this budget is to help small business generate jobs. The aim of this government is to help the wider economy to generate jobs.
I am pleased to advise that we had an increase in full-time employment of some 14,700—reported by the Australian Bureau of Statistics—an increase in part-time employment of 27,300 and an increase in total employment of some 42,000, which is I think very welcome news. I know that members opposite would certainly welcome that improvement in the employment statistics. The government is committed to work hard and to work with business, particularly small business, the engine room of growth and employment in so many regional areas in particular, to get more people into work.
With regard to the budget numbers, it is important to note that employment services is a $7.3 billion budget item—$7.3 billion over the forward estimates. Not all of that money is coming directly from Jobactive and many of the changes to which the shadow minister mentioned relate to changes in wage subsidy policies and the timing of wage subsidies. It is important to point that out.
When I look at what is the alternative, on this side of the House we have got Jobactive—a new, more outcomes-focused system. We have got the Youth Employment Strategy. We have got more flexible wage subsidies. We have got the national rollout of Work for the Dole. Specifically in the Youth Employment Strategy we have got assistance for vulnerable job seekers, transition for youth and a focus on early school leavers. There are many things we are doing in the space. But when I look at those opposite, what do I see? I have only seen a $21 million pilot. That is all I have seen so far in the youth space—just a $21 million pilot. I would hope that members opposite would really focus and get behind what the government is doing.
We have got a range of measures that we are rolling out, and Work for the Dole is going national on 1 July. We are working very hard and we are absolutely committed to helping as many young people as possible move from welfare into work. When I look back on Work for the Dole I think it is an incredible statistic that a job seeker in the electorate of Leichhardt who was unemployed for 395 weeks got a job after a Work for the Dole placement. That is an outstanding result. I think we in this place would struggle to imagine the loss of self-esteem that would occur over such a long period of being unemployed, such a long period on benefits. Work for the Dole is proving to be very helpful to many young people, in particular, people who lack those basic skills, those important soft skills to get by in the workforce.
We have a focus on younger people through the Youth Employment Strategy and we have a focus on older workers through the Restart program. I recently visited the electorate of the good Deputy Speaker—and I know that the Deputy Speaker, as such, does not represent an electorate when she is in the chair. We met with a fine job seeker who had got a job with the assistance of the Restart program—Lexy. After being unemployed, Lexy got a job working in a local community organisation and was able to contribute to a community and get back into the workforce and was doing a great job. Her employers were very happy with the work that Lexy was doing, very happy with it indeed. She was making a great contribution to her employer and it was a great news story. It is part of what employment services can do, the way they can pave the way for people to get onto the first rung of the ladder of employment. Who knows where Lexy will be in a few years time with constant employment?
Most of us would agree that many in our communities across the nation move from education to employment without significant challenge, and many others move freely within the job market, demonstrating the skills and the networks that secure a job. However, there are many men and women of working age in our communities who face challenges and barriers to varying degrees in obtaining a job. Some of that may be because of their capacity and skills, some of it may be because they do not have the connections or the relationships or the networks that would open doors of opportunities for them. We know that under the previous Labor government employment services were allowed to focus on process rather than results. Many of us in our electorates have had job seekers come to us having experienced training after training and they have certificate after certificate and that does not necessarily result in a connection with an employer.
Minister, with the Australian government's new employment services—that will be Jobactive, starting on 1 July—could you please advise, particularly for the people of Macquarie, how job seekers will benefit from the $6.8 billion in the budget for the Jobactive service model?
I thank the member for Macquarie for her question. I know that the good member is absolutely focused on the importance of employment with regard to the future of young people and older job seekers alike. I have certainly enjoyed visiting the good member's electorate. I recall that we visited Richmond Club, a great local club which was hosting Work for the Dole participants. It was a very great organisation in the way that they saw the benefits of Work for the Dole and they were able to provide some very work-like placements indeed at Richmond Club. We saw Work for the Dole participants involved in areas as diverse as greenkeeping in the club's bowling greens and in their golf course. The club also owned a local aged-care facility, so job seekers—whilst not participating in the giving of care, which is out of the scope of Work for the Dole—were able to participate in the laundry operations, in the maintenance operations and in the kitchen of the aged-care facility. I talked to a young person there at the aged care facility who, despite working in the laundry section, aspired to perhaps—at a stage in the future—move into the care of residents if an employment opportunity arose.
Within the licensed club itself there were Work for the Dole participants learning data-entry skills and a range of other skills, so that was a great organisation giving job seekers very work-like activities that were certainly placing them well with regard to the prospect of moving into work.
With regard to jobactive, when we came into government, unfortunately, the employment-services system was bound up in red tape. When I, as a minister new to the portfolio, got around and consulted with employment-services providers, they were saying, 'Lift the burden of red tape off us. We are spending up to 50 per cent of our time filling out forms. We are spending so much time mired in administration. We need to spend more time with our job seekers, have more time to consult with employers and get that match between job seekers and employers.'
We set about reducing red tape immediately, as part of the government's wider commitment to reducing red tape. The employment-services system was an area where we made significant contributions to that, and we were able to reduce red tape on employment-service providers by in excess of $30 million, which is a significant achievement. I know employment-service providers were pleased by that, and that process is not finished. It is ongoing. Under jobactive it will be a more efficient and more effective system, which will have less red tape again.
As to how we are going to deliver better services, there will be a better focus on results. We will not pay for training for training's sake. The outcome that we want is to get people into work. The outcome that employers want is to have a person presenting at the gates of their business, ready for work, and to have the support once that person starts in work. It will be vitally important, if an employment-services provider is to succeed, that they are getting people into jobs and that they are supporting those people into work, because they will be paid. The longer that person is in work, the better the financial result for the employment provider, the better the result for the employer and the better the result for the job seeker.
We have very much a results focused system. We have turned off the tap to training-for-training's sake. I have spoken to so many job seekers who were demoralised by the fact that they had a shoebox full of certificates and none of them was leading to a job. We are not against training—training has its place—but training must be against a backdrop that is leading to a specific job for which there is demand and will result in an outcome for that job seeker. It is a very important change in the system and one that I know is welcomed by virtually the entire sector.
I am very focused on implementing jobactive. The jobactive program starts on 1 July. We will be transitioning job seekers to their new providers. It is going to plan. We are looking forward to getting more people into work and creating more opportunities. I know the good member is looking forward to the start of jobactive. I know that the good member will seize the benefits of a more efficient and more effective jobactive system—a system which has better IT for young people to use technology to access their employment-services provider and to access the jobs that are available. It is a better Australian job-search website. It will be a great improvement over the previous system—an upgrade that is certainly much looked forward to by participants.
I want to raise a couple of issues with the minister. One, in particular, is about local employment coordinators. The minister would be aware that the former government had local employment coordinators in 21 priority-employment areas in the country. They were areas that had issues regarding structural adjustment and/or high unemployment.
I would particularly ask the minister some questions relating to why a decision was made to extend the Geelong employment coordinator, and why Geelong is now the only area in Australia that has a local-employment coordinator. Indeed, they did make some decisions to extend it, but this budget then extended it for another two years at a cost of $1.3 million. The department at the time responded to a question on notice saying that the government recognised that the Geelong region was experiencing a period of significant structural adjustment with a number of large-scale business closures, including Ford and Alcoa, all of which this side of the House has no argument with—and it is true.
But I guess the issue would be: what about those other areas in Australia, particularly those regional areas that have high unemployment, and what specific programs does the government have in place to deal with that? In the last lot of estimates when the government was asked about this, we got some different responses as to why Geelong had this extension. There was some talk about there being a case for Geelong because of the significant retrenchments. This is taken from the transcript of Ms Kidd's evidence. We also had Ms Leon say that a view was taken to give the Geelong program, which had only been in place a short time, the chance to form local employment networks and support, so it had been extended a bit further. So, apart from all of that, we are a bit concerned that a whole range of other areas in Australia might need a local employment coordinator.
If you look at the regional areas of high unemployment across Australia, let's say the top 10, they include areas like Wide Bay, Murray, Hunter Valley, Logan, Beaudesert, Richmond, Tweed, Townsville, New England, Mandurah, the south-east of Tasmania, my home state, the north of Adelaide, north of Moreton Bay, the west of Melbourne, Newcastle and Lake Macquarie. When you talk about high unemployment, all those areas come before Geelong. My question is: why aren't these areas also getting local employment coordinators or extensions of them? I asked the minister very seriously: was this because the member for Corangamite was to appear on Q&A and needed an announcement, or was it much more serious than that? What analysis did the government do to come up with an extension for Geelong and not for any of these other regions that are suffering from significantly high unemployment? This information is according to the ABS. If you look at average unemployment over 12 months, that is the order of areas. The communities in those areas are struggling and the government is sitting by. It is dealing with Geelong, which is a good thing, but it is not dealing with those other areas. As a Tasmanian who has a large number of regions struggling with high unemployment, there does not appear to be a great plan for them from the government.
We heard previously today about the wage subsidy and its flexibility. I would ask the minister about the wage subsidies and the way that the government has structured them. Wage subsidies were very flexible when they were part of the Employment Pathway Fund. Certainly the feedback I got from employment providers was that they loved the flexibility of the Employment Pathway Fund. Some providers are concerned about the structures which the government is putting around its new subsidies. Some subsidies are already in place, such as Restart and the Tasmanian Jobs Program, and others will start on 1 July, such as the youth unemployment wage subsidy and the long-term wage subsidy. Providers are concerned that they will lose some of the flexibility that they had in the Employment Pathway Fund.
I would ask the minister about the flexibility of the new 'flexible fund', which is what it is being called—the $1.2 billion fund. Can the minister confirm that the wage subsidies will have the same targets that were indicated when they were announced? Is the government going to monitor whether those targets will be reached and whether the flexibility that providers had when they were part of the Employment Pathway Fund will remain as part of the flexible funding pool for the wage subsidies?
With regard to the employment facilitators, under the previous government they were scheduled to conclude. The particular facilitator in Geelong had only just started when Labor left office. We saw the special circumstances of Geelong with a major contraction in the employment situation in that area. Let me say that, of all of the other areas that the good member mentioned, they will benefit from a new employment service system. They will benefit from an employment service system that is focused on the delivering results. We are replacing the tired system that was mired in red tape, where there were a range of bureaucratic instruments that made the mind boggle—incredibly complex forms to be filled out and duplicate paper records being run alongside electronic records. It was a system in incredible need of an overall, and this government did that by putting in place a system that is highly focused on results and requires employment service providers to get job seekers a job. It requires employment service providers to build strong relationships with employers, otherwise they will not succeed.
Supporting the focus on results, we had a range of more flexible wage subsidies, allowing wage subsidies to be paid sooner and more flexibly, to meet the needs of employers. We had an end to training for training's sake, so that job seekers were not coming to the end of yet another course, putting another certificate in their shoebox and then sitting down in despair because there was no job attached. It is not in the best interests of a job seeker to cycle them through endless training which is not resulting in a job. So we focused very much on training—where necessary and where it is going to lead to a job.
With regard to the youth stream, we have the new national work experience program providing young people with four weeks work experience, probably but not necessarily in a commercial setting, allowing a young person to demonstrate to an employer just what they can do—the benefits that they could bring to a workplace—and perhaps that young job seeker could be eligible for a wage subsidy. So you could have four weeks' work experience, and then move into a subsidised job.
With regard to the youth employment strategy, we had a number of measures, including $212 million for the Transition to Work program, a program that basically has a work focus. We had programs in the past that were not work focused. Transition to Work is exactly as we said—
Ms Collins interjecting—
It is up to the chair.
I am just getting warmed up.
You can just table it.
A program that is focused on getting young people into work—wrap-around services that are going to assist young people. We also have $106 million for support for vulnerable job seekers, and we have a focus—
Ms Collins interjecting—
The question is that the proposed—
The member for Franklin then left the chamber.
Good on you! You are a—
I will conclude my remarks.
Now we do not have a quorum to put the question. We will suspend until 6.30pm.
Sitting suspended from 17:02 to 18:30
Proposed expenditure agreed to.
Industry and Science Portfolio
Proposed expenditure, $2,326,259,000
I am pleased to rise to speak about the budget for the Industry and Science portfolio, and what a wonderful portfolio it is. It will continue to support Australia's key scientific assets and build momentum in the existing industry initiatives aimed at strengthening Australia's economy and our international competitiveness. It continues the work started under the Industry Innovation and Competiveness Agenda which is I announced last year. The agenda set out a new approach for industry policy, with an emphasis on science, to foster innovation and research. We are putting science at the centre of industry policy. I should at this point welcome my parliamentary secretary, who has joined our team in the reshuffle since the last budget, and is doing an absolutely fantastic job, of course.
We want to have science at the centre of industry policy because it is through stronger links between industry and research that Australia will be to capitalise on the opportunities of the future. We are focused on building business capabilities to improve productivity and competitiveness, as well as stimulate innovation, entrepreneurship and of course jobs growth.
In this budget the government is providing almost $70 million in additional funding for Australia's leading scientific research organisations to build a world-class infrastructure that will create stronger connections between research and industry and maximise Australia's competitiveness. It is a strategic and targeted investment. The budget includes $49.1 million for ANTSO to manage Australia's radioactive waste produced specifically from nuclear medicine production and research in areas of national priority that benefit all Australians.
ANSTO's waste arises from the production of around 85 per cent of Australia's potentially lifesaving nuclear medicines—as well as neutrons to help Australia's industry solve complex problems and enable research into areas of national importance—and 30 per cent of the world's irradiated silicon. The budget also includes an investment so that ANTSO can increase its interim waste storage capacity pending the establishment of a national radioactive waste management facility and funding to enable the return of intermediate-level waste from the United Kingdom in accordance with an intergovernmental agreement.
The government has also committed $20.5 million to the 2016-17 year to ensure the continued operation of the. Australian Synchrotron. This is an important research infrastructure platform delivering groundbreaking scientific discoveries with benefits for all Australians. It is anticipated that the Victorian government, along with the New Zealand government, will also assist in the operating costs in 2016-17. Future ownership and long-term funding of the facility are to be considered by the Commonwealth following outcomes of the research infrastructure review currently underway.
In the budget we also announced the Home Insulation Program Industry Payment Scheme. This was established in response to recommendations of the report of the Royal Commission into the Home Insulation Program. It recognises the government's moral responsibility to the businesses which suffered an adverse financial impact as a direct result of the Home Insulation Program. The scheme will make payments to businesses which suffered an adverse financial impact when the program was cancelled unexpectedly in 2010. The scheme opened to applications on 1 June and will be open for applications for a period of six weeks. However, extensions will be provided to those businesses that are unable to complete their application in that time.
In addition to this, my portfolio will continue to implement the new direction for industry policy that the government announced last year through the Entrepreneurs' Infrastructure Program and the Industry Growth Centres Initiative. For example, I have announced reforms to the Cooperative Research Centres (CRC) Program to better coordinate connections between the industry growth centres and CRCs to achieve common goals. We are also implementing new measures to boost commercial returns from Australia's significant research effort of over $9 billion annually, supplied by the federal government.
We have also released a new national science and research priorities list to ensure our high-performing science, research and innovation system delivers a maximum benefit. Nine cross-disciplinary priorities are: food, soil and water, transport, cybersecurity, energy resources, advanced manufacturing, environmental change and health. These priorities will help our world-class science and research effort to reflect the needs of industry, the national economy and, of course the community.
The government will work with universities, research institutions and industry to identify projects and investment to address the priority areas. The government has a very clear vision for a strong industry sector and, along with that, a strong science sector as Australia maintains our focus on new jobs, new investment and making Australian industry more competitive.
There are some areas where, with the minister's indulgence, I would like to ask a series of questions in order to help inform both the House and the people of Australia on some areas of public policy of great interest. The minister is aware of our enduring interest in this place in the national radioactive waste facility first proposed for Muckaty about 10 years ago, and he will be aware of decisions made by traditional owners and a decision which was quite appropriately made by the federal government last year in the context of the next steps for the location of that radioactive waste facility.
We have heard of the funding that is available for ANSTO to deal with its waste issues in the production of medical isotopes, and we are also aware that in the third quarter of this year ANSTO will receive, or take into its own hands, custody of reprocessed material that will be stored at the ANSTO facility at Lucas Heights—appropriately, as it should be. At the other end of things, and at a much lower level of radioactive waste, there is the waste that had been earmarked for a facility such as that at Muckaty. The way in which the nation deals with the storage of this material is a matter of significant public interest. So I would like to ask the minister, if he can, to share with us the next steps in identifying a facility location. I understand that the site nomination process closed early in May, and I understand that the selection processes would now be well and truly progressed for next steps. So I would like to ask the minister if he can provide us with an update as to where that process is up to and what it is likely to look like over the course of the next few months.
I thank the member for Brand for his question. I also thank him for his bipartisan approach to many of the resource issues we face together. That has been one of the hallmarks of the operation of this government, the previous government and the Howard government: in this very important area in relation to resource development in Australia, we have been able to have a position which has enabled investor confidence and certainty in regard to policy and the development of those industries, which is now entering a different and perhaps difficult phase.
I highlight the fact that Australia has around 4,000 cubic metres of low-level radioactive waste and some 650 cubic metres of intermediate-level radioactive waste, resulting from some 60 years of medical research and industry activities. Unfortunately, much of this waste is stored in hundreds of locations around Australia. As well as that, as the shadow minister mentioned, the intermediate-level waste that has been sent overseas, totalling around 130 cubic metres, is being returned to Australia, and in the interim that waste will be stored at the ANSTO site.
In relation to his specific questions, on 2 March 2015, following the breakdown of the opportunity to progress the Muckaty site, I called for landholders across Australia to volunteer their land for consideration as a potential site for a national nuclear waste facility. The process closed, as the shadow minister mentioned, on 5 May 2015, with an encouraging number of nominations. I am afraid at this stage I cannot be specific about that number, as it is commercial-in-confidence, but certainly there was no shortage of applications from most states across Australia. I intend to identify a short list of potentially suitable sites in July 2015; that is literally next month. I look forward to being able to take those sites forward for detailed assessment during 2015-16. This process will run in parallel with the royal commission into nuclear that is being conducted in South Australia. Along with South Australia, other states that have nominated would likely require a change in some of the legislative processes, so there is quite a bit of work to be done at state level. Consultations with some states are going particularly well.
Once I have identified a short list, there will be extensive community consultation in regard to that short list and its potential suitable sites, and the consultation will continue throughout this project. A site will only be selected if it meets Australia's strict environmental and radiation protection regulatory requirements. A detailed business case for the national facility will be developed during 2016 in accordance with the government's Two Stage Capital Works Approval Process for Australian Government Construction Projects. The project will be referred to the Parliamentary Standing Committee on Public Works prior to detailed design and construction. Under current time frames, the national facility may begin operating in the early 2020s.
Can I say, as someone who has been involved in this issue along with the current Minister for Foreign Affairs, who was at the time the Minister for Education and Science, that this has not been an easy road. Can I just say, though, that in progressing this current project we are receiving much better cooperation not only from the Labor Party in opposition but also, through consultation, from Senator Ludlam and the Greens. We intend to run a fully open and transparent process, and we intend to bring this process to a conclusion. It is simply not acceptable for a nation as technically and scientifically advanced as Australia to be storing nuclear waste in the basements of buildings in CBDs of cities around Australia or in shipping containers in carparks of hospitals. So we will fix this issue, and I hope that bipartisanship continues well into the future.
I have some questions to direct to the minister. Minister, electricity prices are always front of mind in my electorate. In fact you would have noticed that the recent New South Wales election was dominated by electricity issues, particularly whether or not to lease the New South Wales electricity network assets.
One of the arguments used in support of asset privatisation is that privately operated assets are often run more efficiently and result in cheaper electricity bills for customers. This government has always said that it will work hard to put downward pressure on electricity prices. We repealed the carbon tax, and in doing so we provided savings of around $500 a year to an average household.
I notice that new national rules that require electricity network prices to be set with the long-term interests of customers in mind mean that households and businesses in my home state of New South Wales, and also in the ACT, South Australia and Queensland, will see decreases to electricity bills from 1 July this year. I have no doubt that you have plans to keep chipping away at electricity prices to ensure that Australian households and businesses are not paying too much for their electricity. But there is one particular matter I would be interested to hear more about—that is, the national energy productivity plan, which was announced as part of the government's recently released energy white paper. The white paper announced an aspirational national productivity target of up to 40 per cent improvement in productivity by 2030 and a commitment to develop a national energy productivity plan.
Minister, can you please tell us how a productive energy sector contributes to a stronger economy? Can you give us an update on the development of this energy productivity plan? What information is considered when deciding a target, and what kind of opportunities are there for Australia to improve its productivity? How could improving our energy productivity contribute to our broader government goals, such as growing the economy or meeting an international emissions agenda?
I thank the member for Eden-Monaro for his question. He is quite right; electricity prices are front of mind in households around Australia. In fact, discussion about the cost of electricity has replaced the conversation which existed in my earlier political career around the price of petrol. People now look at their electricity bills and they wonder how they can lower them. I have to give them credit; households are doing a fantastic job in embracing energy efficiency in their households—either through state policy or independently installing smart meters and energy efficient appliances. In my household we recently installed a front-loading washing machine. Along with incredible efficiency in terms of its energy consumption, its water efficiency is also worth noting.
This government takes this issue particularly seriously. One of the first things we did as a government—as the member for Eden-Monaro knows, and as I am sure his constituents still appreciate—was remove the carbon tax, saving households a very significant sum of money in relation to their electricity costs and their household bills. In specific terms in relation to the member's question, we will continue the issue of energy market reform, which is a challenging issue.
Without breaking the bipartisanship that I expressed earlier, I can say that it was one of my criticisms—if not my only criticism—that during the tenure of the previous Minister for Resources, Martin Ferguson, the issue of energy market reform did not progress as far as I would have hoped. I hoped that by the time I got back here it would have been all finished, but unfortunately that was not the case. There is still some way to go. We are looking at the contribution of a productive energy sector to a stronger economy. Energy productivity is a measure of economy value created in every unit of energy consumed, and it is an area that we continue to pursue.
Improving Australia's energy productivity can reduce costs for households and businesses, grow our economy, maintain our competitiveness and improve our sustainability. The more productive use of energy can also delay the need for new energy supply infrastructure, which in turn lowers the cost to users who would otherwise be paying for that infrastructure. The National Energy Productivity Plan, or NEPP, will include a work plan to progress both existing and new initiatives across the energy efficiency policy and energy market reform areas.
The Australian government will work with state and territory governments, and that is always a joy, but some states are more cooperative than others. Surprisingly, some Labor states are more cooperative than some coalition states. I have to tell you that has not changed in the 15 years since I first became a minister. The meetings are less entertaining and more productive, but there is still the occasional spat. We will work through the COAG council on energy during June 2015 to consider collaborative measures to support the work plan, as well as Commonwealth measures, particularly voluntary industry-led measures, which are also expected to be part of the work plan. Measures to improve energy productivity include traditional energy efficiency measures such as minimum standards, but also wider energy market reforms promoting efficient energy use, decisions and markets such as efficient pricing, servicing and competition.
In the area of opportunities for Australia to improve its energy productivity, the work plan for NEPP will include measures which support efficient decisions by consumers of all sizes, in all sectors, when selecting energy services such as smart meters—which I have mentioned—cost-reflected prices or time-of-use charging, as it is known, and access to information and labels. It will also support the development of better energy services through innovation and competition, such as reducing barriers to entry in the market for new technologies and service options. I have to say that there are some fantastic energy saving technologies and energy efficient appliances coming onto the market virtually every day. We will also ensure that efficient minimum services, including through standards for equipment, appliances and buildings, are made available.
Energy productivity measures can drive a range of wider benefits such as jobs in new services and health and labour productivity improvements in better buildings. Using energy more productively can reduce the amount of energy we use, resulting in low emissions from energy consumption.
I have a series of questions for the minister, some of which he may wish to take on notice and write back to me about. The first one deals with the ACCC inquiry into the east coast gas markets. Can the minister provide an update on the east coast gas market and the current ACCC inquiry? It is an important inquiry. It is an inquiry that has received deep bipartisan support, and its progress is important. I am pleased to hear the minister's continued strong support for markets and market solutions to our energy issues. Linked with that, the New South Wales government has, of course, challenged a Commonwealth regulator in its decision on network costs in New South Wales. This is a challenge which I have characterised as being a desire by the New South Wales government to 'fatten the pig before it is taken to market'. I would appreciate the minister's considered view of the Commonwealth's position on that matter, and hope that what we hear is that the Commonwealth will not be supporting the New South Wales government and will ask the New South Wales government to desist in its threats to that decision.
We are all aware of and concerned about the east coast gas price movements. One potential step in that process may be the North East Gas Interconnector, as we have often referred to it in public statements. Where are we with that? The energy white paper spoke of the need to conduct an assessment of Australia's energy security. Can the minister provide an update on the scope and timing of that assessment? In particular, the International Energy Agency stockholding requirements could place a crippling cost burden on Australia's transport fuel industry. I would be interested in the minister's consideration of that issue as, for me, it is a matter of concern that the IEA's stockholding requirement may place a very significant cost on the Australian economy and on transport users.
Finally, Minister, a matter which I know is dear to your heart and to mine: Geoscience Australia. I understand that, currently, Geoscience Australia has nine graduate positions and is planning to make 13 offers in the coming year. From what I understand, there is a very large number of applicants for these positions—around 150. Normally, we would be used to a figure of about a third of that, about 50. One hundred and fifty is a particularly high number. Does the minister believe that we have a sufficient number of current graduate positions in Geoscience Australia to support Geoscience's needs or can we look forward to increases in that number over the budgeted number of 13?
I thank the shadow minister for his questions. I will try to get through as many as I can in the time allocated. With regard to the ACCC inquiry, it is the government's desire to ensure that we have a clear and transparent gas marketing and transport system in Australia. The Minister for Small Business and I have engaged the ACCC in an inquiry to investigate that. It is not a witch-hunt. It is not our expectation that the commission will find any untoward activity, but we are letting the commission have a very good look at the situation because we are going to see fluctuations in the price of gas in Australia and we need to be sure that the market is working as it should. The issue paper in relation to the ACCC inquiry seeking industry input was released two weeks ago and we are keen to see industry participate in that as much as they can.
In terms of the shadow minister's suggestion that I ask the New South Wales government to desist, yes, I always ask the New South Wales government and any other government to do the right thing, but I have to say it has been one of my failures in political life. State governments have a mind of their own. In terms of their particular objections to the ruling of the AER, I express my total confidence in Paula Conboy, to the point where my money is on her. Whilst state governments and particularly their treasuries will do what they do—and I note the member's comments in relation to fattening the pig; I am sure that is not the case—what the AER will do is deliver lower electricity prices to New South Wales consumers and particularly households. Along with the abolition of the carbon tax, we are seeing significant decreases in the price of electricity in most states as a result. I have to congratulate the work of the AER.
With regard to the north-east interconnector, the connector from the Northern Territory to Mount Isa, I have an optimistic view on that. From my discussions with the Northern Territory government, they have a number of very credible proponents proposing to build that gas pipeline and proposing to build it at no cost to government, which is always music to my ears. The reality is that there is significant demand, particularly in New South Wales, where the CSG industry has been unable to progress in the spectacular, constructive and environmentally sensitive way that it has in Queensland. It is unlikely to see the advance of CSG in New South Wales in the short term and, as a result of that, we will be continuing to support the Northern Territory government in its endeavours to have that interconnector built. As I say, I am optimistic.
The member for Brand asked about the IEA and Australia's strategic reserves in compliance with the IEA. As he knows, as he was the minister who passed the hot potato to me when they left government, we were noncompliant in the last term of government, and our government is looking at a path back to ensure that we satisfy the requirements and remain a member of the IEA.
We have just had some discussions with the IEA in Paris—'we' being my department—and it is my understanding that the IEA is prepared to consider Australia's approach to this matter. It has the potential to be extremely expensive if we do not handle it carefully, and as a result of that there will be ongoing discussions. The reality is that Australia's change in production—the fall in oil production and, as is always expected, a rise in consumption—has meant that we have been noncompliant and have been, as I say, for quite some time.
The last question, with regard to Geoscience—I certainly understand the concern of the member. I do not envisage an increase in the number of places in Geoscience Australia for graduates.
Minister, it is a pleasure to see you here in the chamber. As you know, it could be argued that the resources industry has been the backbone of Australia's economy for the last decade or so. At least, it is inarguable that it has made an extraordinary contribution to our export earnings. In my state of Western Australia particularly the impact of the iron ore and the oil and gas industries has been transformational. I would like to note your keen interest in the Western Australian resource sector and industry over the many years that you have been in parliament. I heard you compliment the member for Brand and the previous minister, Martin Ferguson, both of whom I considered to be friends of the resource sector in Western Australia, but unfortunately their party at the time introduced the mining tax and displayed their party's overall attitude towards the mining and resource sector in Western Australia.
I noted that in your previous answer to the member for Eden-Monaro you spoke about electricity prices. I thought the minister might be interested to know that in my previous life as a commercial air conditioning supplier, one of the things we tried to introduce into Australia in the 1980s was an economy cycle for package equipment on shopping centres. Unfortunately, at that particular stage, electricity prices were so cheap that there would have been a seven-year turnaround before they could actually recover the cost of the economy cycle system. Many employers would say it was easier to reduce staff levels than it was to look at reducing electricity costs because it was not a high cost for the companies at that particular time.
As I said, in my state of Western Australia, the impact of the iron ore and the oil and gas industries in particular has been transformational. As we speak, the world's first floating LNG plant is under construction prior to its deployment off the coast of Western Australia. This exciting new technology will render recoverable smaller and/or more distant resources that were previously quarantined by these limitations. Meanwhile, on the east coast, coal has continued to generate massive export earnings and we have recently seen the first of three new LNG plants on Queensland's Curtis Island commence exporting. I know you probably have an even deeper interest in Queensland than you do in Western Australia, but as the federal minister I guess your attention has to be in all states.
These plants sourcing their feedstock from coal seam gas are also pioneering, world first, and further demonstrate the confidence that industry has in Australia as an investment destination. However, the resources industry's cyclical nature has been clearly evident over the past decade, with an enormous rise in commodity prices and a spate of major capital projects in the LNG, coal and iron ore industries in particular. This boom period has now clearly passed and those prices have dropped very significantly, just as the project construction process is concluding, along with the jobs of those engaged to give effect to it.
Minister, what is your view on the short- and medium-term prospects for Australia's resources industry? What actions is the government taking and/or planning to take through this budget, or any other government measures, to ameliorate the adverse impacts of these changes? Is there a future for Australia's coal industry given the increased intensity across the world of anti-coal activism, not only among its traditional critics but also from the investment community?
I thank my good friend the member for Swan, and I also thank him for the tremendous support he gives to the resources industry not only in Western Australia but also, of course, throughout Australia. As he well knows, there are other states that mine resources other than Western Australia. Of course, Queensland is a very significant resource state, as are other states.
In relation to the floating LNG technology, I had the opportunity to visit the shipyard where Prelude is being constructed. It is a massive piece of engineering, which I am sure my parliamentary secretary, as an engineer, would greatly appreciate. To give members some idea of the size of this, the structure, if it was placed in front of the Sydney Harbour Bridge in Sydney Harbour, would actually shield the entire bridge. It would cover it from one end to the other and also cover the top of the arch. It is the latest in technology and Australia is the only place in the world that is currently deploying or has deployed the three LNG technologies—floating LNG, LNG from coal seam gas, with the first train being operated by QGC in Queensland, and of course the traditional LNG natural gas technology that we have seen built in Western Australia and Darwin, and there is further construction going on at the moment.
As the member for Swan quite rightly points out, the energy and resources sector is a key contributor to the national economy and generates crucial export revenue and, more importantly, keeps Australians in jobs and pays significant taxes and royalties. In fact, the previous government tried to pretend that the industry did not pay its fair share of taxes, but it certainly paid more taxes than most industries in Australia in a percentage sense, bearing in mind that, along with company tax and the like, it also pays a very significant royalty to most state governments.
The Australian resources and energy sector will continue to be challenged over the short term. It is no secret that the commodity prices have fallen significantly. Many of those commodities are still very profitable to mine. Whilst there has been a lot of discussion about iron ore prices in the media of late, the reality is that large companies like Rio Tinto and BHP Billiton are making significant profits on their costs. That industry is a very sustainable industry.
Perhaps the picture is not quite so bright in the coal area but, again, the industry is driving efficiencies and costs of production cuts in that area that will see the industry be maintained. It is interesting to note that exports of coal out of Queensland were said today to be at record levels. Australia will be a key supplier of mineral and energy commodities to the world and a reliable supplier well into the future. We have seen very significant investment in all of these sectors, but the reality is that now we are going to see a very significant increase in production as a result of those investments.
The member asked me what our government is doing in contrast to the previous government. We have removed the mining tax and the carbon tax. Why you would tax a sector that is holding up the rest of the economy is beyond me, but the Labor Party has never found something it cannot tax. We have also established the Exploration Development Incentive. That was the second failure of my predecessor, Martin Ferguson, who promised a flow-through share scheme. It must have just slipped through his fingers.
An opposition member interjecting—
No, we are not. We have put in place the Exploration Development Incentive, which has been welcomed by industry, and of course we have worked to see the industry growth centres integrated into the resource sector.
We will remain the largest exporter of metallurgical coal, which is a non-substitutable raw material for steel making. We will continue to see coal remain as a dominant energy source globally. Whilst there may be some reduction in the OECD, predicted to be one-third by 2040, coal demand in India, China and South-East Asia is projected to more than offset that decline. Australia, and particularly Queensland and New South Wales, will continue to meet that demand.
It is good that the minister has such a good memory because he would remember the Rudd government securing investment for the Cruze, a small car to be manufactured at the Holden factory in my electorate. He will remember coming for a tour when the company was considering future investment at that plant, and he will remember the devastating day for those workers when the government chased Holden out of the country along with all of the investment they were going to provide. He would no doubt also remember, I think it was on 10 March, when he, or someone else, briefed The Advertiser that $900 million from the Automotive Transformation Scheme would be spent in South Australia and that that was going to reassure the industry and keep stability in our industry. No doubt he would remember on 20 April when Holden announced the reduction of 270 jobs—redundancies that are now flowing through. People in my electorate are being made redundant, are out of work, at a critical time in their lives. Many of these workers are not old men or old women. They are in the prime of their working lives and they have families and investments in South Australia. No doubt he would remember on 11 March James Massola writing in the Fairfax press a headline which said, '"This is an own goal": Ian Macfarlane accused of bungling car industry assistance announcement.' In that story, an unnamed minister—as is so often the case with this government because the cabinet leaks like a sieve—said of your performance:
This is an own goal. It is complete incompetence.
Then:
"We won the war [on industry assistance] but Macfarlane was an unhappy general," the minister continued in a clear reference to the losing fight Mr Macfarlane led in the early days of the Abbott government to keep Holden and Toyota manufacturing in Australia.
It is a pretty devastating story for the minister, I would have thought. So, given all of this history, Minister, perhaps you can let us know, the parliament and the people of South Australia, what your intention is with regard to the Automotive Transformation Scheme. How much of it will be spent in South Australia and how much of it will simply be returned to the Treasury as savings to prop up your budget?
There was a huge amount of hypothetical in that question. I will do my best to address it. I do wonder at times how people from the Labor Party can ever rise to their feet and criticise our government when tonight of course, at 8.30 pm—and by God I hope we are out of here by then—I will be sitting downstairs watching a completely incompetent—
An honourable member interjecting—
I would ask the member to desist.
He is the one who raised the political issue and I am responding to it.
Honourable members interjecting—
I ask members to desist please.
I look forward to the factual recounting of the performance of the Labor Party at 8.30 pm tonight on the ABC. I am sure—
An honourable member: What about the workers at Holden?
I did ask members opposite to desist from interrupting the Minister while he is addressing the question and, as to your comment back to me, to the member for Chisholm—
And to the interjection, Madam Deputy Speaker, I—
Sorry, Minister. Just one minute. The comment from the member for Chisholm was reflecting on the chair and I would ask you to desist from doing that. Thank you very much, and I give the call back to the minister.
I am always happy to answer questions in the spirit they are asked by the shadow minister for resources. This particular member asked questions that were vague, inaccurate and highly political. I am not responding politically. I am just saying to do yourself a favour and watch the ABC at 8.30 tonight.
With regard to the performance of the previous Labor government and the claims made by the member, the reality is that at no stage did the Labor Party insist on the one thing that was crucial to the survival of the car industry, and that is that the money they sprayed at them—ineffectively, I have to say—caused the companies to perform at an international standard by exporting their vehicles, with the exception of Toyota. As to the suggestion that there were significant plans by any manufacturer other than Toyota for another model, I think that is sheer speculation.
I totally reject any suggestion that our government did anything but support the car industry during that time, and of course it was GM's decision in Detroit to end production of Holden. That has been quoted time and again by senior executives in GM, including most recently at the Detroit motor show earlier this year, that no action by the government in terms of supplying further assistance would have changed the decision by General Motors to close production.
The member asks about the announcement in Adelaide recently in relation to the ATS. I am going to stick to the facts, not the media speculation and unnamed sources et cetera. The reality is that that announcement resulted in $683.4 million more being made available to the car industry. The member asks how much of that money the car industry used. Well, that is entirely dependent on the car industry. The more Australian-built cars they sell, the more money we will give them. There is more than enough money there—as I said, an extra $683.4 million. That is something I am extraordinarily proud of, because I was the minister, of course, who put this car plan in place.
When I was last minister I put in place a $4.3 billion plan for the car industry—a plan which gave the car industry the opportunity to be an internationally competitive force. They did their best; I think they make a fantastic product and the workers there should be proud of that. But decisions made in headquarters in Detroit, and finally in Japan, have seen this industry progress to a position where it is not going to exist in Australia post-2017. No-one is sadder about that than I am. No-one has been more patient about the car industry as a minister than I have—or no living person, anyway, because John Button certainly was. But in terms of the decisions that were made, the reality is now that Australian production has fallen to a point where international owners have made those decisions.
We will support the workers in South Australia. There are a number of significant programs in place, including the growth fund of $155 million targeted at the industry to assist it in that transformation, and we will do everything we can to assist workers during a very difficult time as they transition to new professions.
Minister, as a fellow Queenslander—and I am certain you will be watching a particular game of rugby league tomorrow night and supporting the right side and the right team indeed!—you are no doubt aware that my electorate of Hinkler is a diverse electorate and a shining example of Queensland ingenuity and determination. Like many of our neighbouring Queensland electorates, we have made the full use of the natural blessings of our region. As a result, we have strong and vibrant businesses operating in food and agribusiness, mining and advanced manufacturing services. I know the minister is aware of some of these organisations and companies, but I would like to give him a brief review of what is going on in my electorate.
I am sure that the minister is aware of the announcement by Knauf Australia to build an advanced manufacturing plant at the Bundaberg Port, but he may not be aware that the development approval actually came from Gladstone Ports Corporation in recent weeks. This is a fantastic announcement: some $70 million worth of investment that will create at least 60 to 70 long-term jobs and some 200 jobs in the construction of this facility.
We have organisations like Bundaberg Walkers Engineering Ltd. I am sure the minister is aware that it is struggling with high electricity prices. It is a real concern for them. There is also Bundaberg Brewed Drinks, the 2013 Queensland Exporter of the Year.
But there are a number of horticultural producers and manufacturers, which the minister may well not be aware of—organisations like Austchilli. Austchilli started from a concept by a cane farmer by the name of David De Paoli. Mr De Paoli now runs an organisation that grows eight different varieties of chillies that are hand-picked every day to ensure year-round supply for consumers. Since 1995, they have field tested over 200 varieties of chillies from all over the world to find the best on the basis of flavour, heat, colour, yield and consistency.
As well as growing chillies, they grow a wide variety of herbs that they value-add to and manufacture a range of products from, including a new product called AvoFresh made from avocados—so successful, Minister, that they cannot actually source enough raw product to meet demand. They export fresh and packaged food to 10 overseas markets. Their products were also featured recently on the hit reality show, My Kitchen Rules. They are a fabulous provider—the hero of the dish, I have been told!
Farmfresh Fine Foods is another second-generation family company operating with Australian food technology. They manufacture; they supply chargrilled and roasted vegetables to the domestic and international food service industry, including airlines, global fast food chains and cafe and restaurant chains—unlike the 'Made in France' products that I saw on the flight this week, which were very disappointing.
Urangan Fisheries process professionally and export a wide variety of fresh and frozen seafood, including the world-renowned Hervey Bay scallops, which I am sure everyone in the room has heard of—I am sure you have, Madam Deputy Speaker.
I have enjoyed a few, yes, thank you!
They are a fabulous product that they export to Asia, the United States of America and the EU, and they have been doing this for over 10 years. Urangan Fisheries are supported by seven prawn and scallop-catching vessels owned by Hervey Bay based sister company, Shulz Fisheries. A well known local, Nick Shulz has been in the region all of his life—a great operator. And, of course, you cannot go past the Australian Ocean King Prawn Company, another family business, supplying premium quality seafood out of Hervey Bay for local and export markets for over 25 years. They have a fleet of six trawlers—modern, EU-accredited steel vessels, equipped with state-of-the-art refrigeration systems. They land a combined total of 300 to 400 tonnes of prawns all year for the export market. It is a fabulous product and it is great that it is in my electorate.
Minister, I note that these businesses cover much of the five areas identified as areas of competitive strength which are the focus of the Australian government's Industry Growth Centres. As the local representative of a region that has firsthand experience of the opportunities created by investment and innovation in these key sectors, I am particularly excited on behalf of my electorate to follow the progress as the Australian government implements these growth centres. Under the Industry Growth Centres Initiative in the 2015-16 budget, I understand that the Department of Industry and Science funded some $225 million to deliver this exciting new initiative. I also note that this is an increase—an increase!—on the initial announcement from October 2014 of $188.5 million for this initiative.
We look forward to grasping every opportunity to strengthen our local economy in my electorate of Hinkler, particularly in these areas of competitive strength. Can you please provide the chamber with an update on the initiative and tell us how the Industry Growth Centres are going to put science at the centre of industry policy and help companies like those in my electorate—like Bundaberg Brewed Drinks, Knauf Australia and Bundaberg Walker Engineering Ltd—to drive the growth and jobs of the future, not only in my electorate but across Australia?
I thank the member for Hinkler for an extraordinarily constructive and informative question. What a wonderful job the member for Hinkler is doing in his electorate.
I happen to know this electorate reasonably well. I grew up not far—well, not far if you are a country boy!—from Bundaberg. We occasionally went over there because in those days Bundaberg did, and still does, have a reputation for excellence in engineering—and perhaps for one other thing in those days! But these days, of course, it has broadened its drinks list out to include Bundaberg Brewed Drinks. Bundaberg Brewed Drinks is a wonderful company that puts product out, and not only right around Australia. I happened to catch up with its CEO on a flight back from America and I asked him what he was doing in California. He said he had just been over to sell ginger beer and drinks into America. It is a great exporting company.
As with everything in the manufacturing and industry space in Australia, we need to capitalise on our export opportunities. The member noted, quite rightly, that in the budget just released we have in fact increased the funding for growth centres to $225 million. The Industry Growth Centre Initiative provides a new approach for industry policy. It builds on Australia's strengths in key sectors, and the member has clearly identified food processing and agribusiness. It is great news about the DA for Knauf Australia in his electorate.
But in the area of food processing and agribusiness we have a specific growth centre, which is headed up by Peter Schultz. That growth centre will provide not only the existing businesses in Hinkler with the opportunity to collaborate, to develop new products and to get into the global supply chain but also potential new industries that neither the member nor I have even thought about.
The growth centre initiative is the centrepiece of the government's strategy to guide industry in the new era of growth—a new era of investment and jobs—and we will do that by focusing on the areas which, as the member identified, are where Australia has a key natural advantage.
There are five industry growth centres. I have mentioned the food and agribusiness one. The Advanced Manufacturing Growth Centre is headed up by Andrew Stevens, who is well known for his work in the ICT area in Australia. Bronwyn Evans heads up the Medical Technologies and Pharmaceuticals Growth Centre. Again, particularly in the area of medical technologies, Australia excels. Everyone knows about Cochlear, but there are a whole range of products that Australia has developed there as well. The Mining Equipment, Technology and Services Growth Centre is headed by Elizabeth Lewis-Gray, an extraordinary woman who has played a key role in the development of the MET sector in Australia. Australia is the world leader in exporting mining and equipment technology all over the world. As well as that, Ken Fitzpatrick heads up the Oil, Gas and Energy Resources Growth Centre.
These growth centres will forge better links between industry and Australia's world-class researchers to maximise return on the Australian government's $9.2 billion annual investment in science and research. As the parliamentary secretary knows, we have some of the best scientists in the world. We have a great opportunity in terms of the products that they are working on to commercialise. By getting them to collaborate with world-class businesses, such as those identified by the member for Hinkler, I am confident in terms of our potential to play an important role in global supply chains going forward.
The growth centres are headed up by an overarching board. John Grill is the chair of that, along with Catherine Livingstone, Andrew Liveris, the most senior Australian-born CEO in the world, and, of course, Carolyn Hewson. I particularly want to thank John for his unselfish involvement in these growth centres. John has a distinguished career in business in Australia. He is a well-known philanthropist in terms of supporting science and research in Australia. But his commitment to this is without comparison. He has done an extraordinary job. The government is confident that this will deliver what we need to keep industry competitive in the future.
I was just looking through the minister's website; it does have some really good pictures up of his tour of GM Holden on 2 October 2013. They are still up there. I remember touring the plant with him and many other Liberal senators and Liberal backbenchers. I think the member for Hindmarsh was good enough to arrive. Amongst all of his attacks about the ABC, my party and all the rest of it, I did note one thing that the minister said about exports. In particular, there are a couple of questions I have. First of all, as the cabinet deliberations went on between the minister's tour of the GM plant on 2 October and the announcement of closure on 12 December, did that delay affect the company's decision? Did those internal deliberations of the cabinet and the battle that he fought with the Treasurer and others affect the company's decision and his opinion?
I have another question. In the announcement by Mike Devereux from Holden about the company, they talked about a perfect storm. One of the factors in that perfect storm was the price of the Australian dollar which, I think, at the time was around $1.07—around that mark. It had been there for quite some time. It was, I think, one of the very real problems affecting manufacturing in not just cars but also wine, or anybody else who was manufacturing and exporting at that time. It was a very big consideration in their economic performance. Given that the dollar is now at 77c, does the minister agree that we have come out of the other side of that perfect storm that Australian manufacturing had been facing? Does he consider the fact that if the company and the government were considering the same set of circumstances today they might well make a different decision, and that manufacturing might well have continued in Australia if the decisions in cabinet had been different and if people had been able to look a little bit further down the track on the Australian dollar? They are the very real questions I am asking of him.
I am asking his opinion about the time line on which the government made decisions at that point and its inability to see past that perfect storm which was making car manufacturing and exporting very difficult. We know that if the dollar falls below 90c then car exports can occur very effectively to, say, the police car market in the United States. We know that many police forces in the United States wanted to buy the Holden Caprice that was modified for the police car market. We know that the only thing that was making them uncompetitive in those markets was the value of the Australian dollar, which was a temporary thing. I would be very interested to know the minister's opinion. If we were making those decisions now, and if the company were making those decisions now, does he think that things might well be different?
Again, I have to say I admire persistence in any creed, and the member for Wakefield is certainly persistent in asking hypothetical questions. Can I just say with regard to the government's position that the decision was made entirely by GM. It was entirely uninfluenced by anything the government said, did or potentially could do; in fact, we were advised by the management of GM in Detroit that anything we potentially could do would not have influenced their decision at all. That coincides with the information that I received privately. I am not going to divulge the sources of that information—
Mr Champion interjecting—
I will try and answer the question, Madam Deputy Speaker.
Thank you, yes. Could we have the answer? Thank you.
He does need to stop interjecting. He has had his question. In terms of the dollar, an industry that involves itself in the export market deals with fluctuations in the dollar. During my time as minister I have seen the dollar as low as 48c and, as the member said, almost touching $1.20. The decision by General Motors in Detroit is a decision that was made by them without consultation with the government, and it was based on their own facts. I am not privy to the facts which they based their decision on. I am privy to the public statements made by General Motors in relation to the fact that nothing they could have asked this government to do would have changed that decision. It was a decision which, obviously, General Motors had made their mind up to make. They made their decision. This government responded to that decision and the subsequent decision. I know it was extraordinarily difficult for Toyota to cease production in Australia. Australia was the first country in which Toyota built an overseas assembly line. I have visited the Toyota plant in Altona, and the member for Wakefield and I visited the plant in Adelaide, and I know that the workers at both those plants took enormous pride in the vehicles they were producing—and can I say: they are fantastic vehicles.
The unfortunate reality is that as the market in Australia changed, and as the market tastes of consumers in Australia changed, there simply was not the demand for the vehicles being produced by GMH in Adelaide. We have seen those numbers trending down for a long time, and currency fluctuations may or may not have influenced the decision by GM, but the reality is that we are at a point in Australia where only around one in 10 Australians purchase cars that were built here.
We have reacted to the decision by GM and the subsequent decision by Toyota's parent in Japan by putting in place the industry growth fund and by working with governments of both persuasions in both Victoria and South Australia to ensure that we do everything we can to allow the component industries, in particular, in the car industry to transition to new manufacture. I had the opportunity last week in Adelaide to visit a company called Precision Engineering that is diversifying into the solar industry—not just diversifying into the solar industry but actually doing it using Australian technology developed by that extraordinarily eminent organisation, CSIRO.
That technology is being exported into Japan. So we are seeing the transition of component companies to other areas. We are also making money available to retrain workers who will be made redundant by the end of the auto industry and give them the opportunity to take up jobs in new areas. As well as that, we are encouraging companies to come and invest. We have been overwhelmed with the response to that. We have seen very significant applications in that regard. We continue to assist the industry through the ATS. As I said to the member on the last question, we have made a very significant increase in terms of the money available: over $680 million.
Minister, I understand that in the 2014-15 budget, under the Entrepreneurs Infrastructure Program, the Department of Industry and Science was funded to deliver a Single Business Service to help achieve efficiencies and reduce red tape. As I understand it, the Single Business Service streamlines access to essential information for all Australian businesses. It is delivered through an improved website and contact centre, as well as AusIndustry's national facilitation network. The Single Business Service enables businesses of all sizes to efficiently find the information and services they require across all levels of government, including compliance information, insights into business improvement strategies and essential information on planning, starting and running a business. The Single Business Service can also link businesses to specific Australian Government assistance programs like the Entrepreneurs Infrastructure Program and the research and development tax incentives. The feedback from my constituents in Moore is that this program delivered by AusIndustry has seen a marked improvement in the delivery of business advice and in program delivery.
I note that in the 2015-16 budget the department is funded, along with the Australian Business Register and ASIC, to deliver elements of a new streamlined business registration interface and components of the new Digital Transformation Office. Whilst reviewing the business.gov.au website I have also noticed extensive information on the small business package. Minister, given the growth of the Single Business Service, would you advise the chamber of the success of this measure?
I thank the member for Moore for his question and say what a wonderful job he is doing as the member replacing a very dear friend of mine, Mal Washer. Mal and I came into this parliament together. We had rooms side by side up in the north wing, as we called it. Those of us who remember Mal also remember Gloria Riley with great fondness. I take this opportunity to express my condolences to Gloria's family and acknowledge what a wonderful friend she was not only to Mal but also to the constituents who came into the electorate office in Moore. Mal was a wonderful member, but the current member is doing a fine job.
In response to his question, the Single Business Service, which was implemented by the Abbott government, is successfully enabling Australia's 2.1 million businesses to access essential information and services that they need to start, run and grow their operation. We have an extraordinary Minister for Small Business in our government. Those 2.1 million businesses are more than ably represented by what is undoubtedly one of the most enthusiastic ministers for small business I have seen for quite some time. I say that as a previous Minister for Small Business; that is where I started my ministerial career. The minister does a fantastic job. The Single Business Service point has effectively streamlined resources for businesses through one website, and that website—I am never one to miss an opportunity to publicise it—is business.gov.au. As well as that, there is one contact centre and one outreach network, which is of course that wonderful entity, AusIndustry, which does a fantastic job for businesses in Australia. Businesses and business intenders can now find what they need when they need it on popular topics such as starting a business, registration and licences. That allows them to cut through the red tape, which of course is a pledge of our government, saving time and money. The consolidated channels also assure the government that the services are being delivered in the most effective manner.
Businesses are using Single Business Service in large volumes. In the first 11 months of operation, there have been more than 10.8 million unique page views to business.gov.au—a substantial increase; in fact, an increase of 25.4 per cent over the period in the previous 12 months. The contact centre has taken over 71,000 phone calls, emails and web chats—an even larger increase on the previous year of around 43 per cent. Further enhancements to the contact centre web presence and ICT infrastructure will be implemented over the forward estimates. These will include more tailored online customer features and a consumer relationship management solution. Single Business Service is also working to improve program design and delivery through its centre of excellence.
The Entrepreneurs' Infrastructure Program, which was also implemented by this government, is delivering through the Single Business Service. It offers practical support for businesses. It provides expert assistance from a national network of more than 100 private sector advisers for cofunded commercialisation grants, research connections and collaboration opportunities. As at 31 May 2015, almost 3,000 services and around 500 cofunded grants totalling $23.3 million have been approved. The Single Business Service is helping Australians understand and access the government's Growing Jobs and Small Business package, and specific small-business information pages established on business.gov.au have seen some 280,000 unique visits. In terms of business.gov.au, it will become a single online portal for streamlined business registration initiatives which were announced as part of the Growing Jobs and Small Business package. As well as that, the department is playing a leading role in the digital transformation agenda.
Minister, I have several questions and it is clear that I will not be able to get to them. I was thinking that perhaps we should revert to the House standing orders, where we only have three minutes to answer questions. Minister, I fully accept your understanding of the auto industry throughout this country. You would be well aware of the impact that the impending closure of car-making in Australia is having, particularly in communities in South Australia and Victoria. Indeed, the impacts are already being felt and job losses have already begun to occur. With respect to the Manufacturing Transition Grants Program, I understand that, of the 19 successful projects that were given grants, one was from South Australia and only three were from Victoria. Can you advise why that was the case? Can you also advise which other applicants from South Australia and Victoria applied for funding and why they were rejected? Can you also advise, with respect to the Next Generation Manufacturing Investment Program, which I understand was announced in December 2013, why it has taken so long for an announcement that any project has been successful in getting funding?
I thank the member for Makin for his question. I say to him that the government and I as minister are particularly aware of the impacts of the closure of the auto industry, as said earlier. My involvement with the car industry goes back a very long time to 2001, when I inherited a car plan that was pioneered by a previous member for Ryan, Minister John Moore. As I said, we put in place a very significant $4.3 billion program under the ATS to ensure that the industry was able to look at every opportunity. We know that, unfortunately, that did not happen and the industry announced, of its own volition, the fact that it was closing.
The member asked about components of the $150 million growth fund, which our government launched, as I said earlier, in response to issues in relation to the closure of the auto manufacturing industry in Australia. We announced that on 30 April 2014. There are key elements to the growth fund, which totals $155 million. There is a $30 million skills and training program to help automotive workers find new jobs. There is a $15 million extension and modification to the Automotive Industry Structural Adjustment Program to help automotive workers find new jobs when they are retrenched. Both of those programs are up and going. There is a $20 million Automotive Diversification Program to help the auto supply chain firms with their diversification. The member for Makin asked questions in relation to that. Those questions, in the main, are commercial-in-confidence, but I can say that, in the awarding of grants to applicants, it is done simply on the basis of which grants are the best. In its operation, that scheme has also been very successful.
The member also asked about the $60 million Next Generation Manufacturing Investment Program. My department is currently considering applications in relation to that. Based on those considerations, we will be making an announcement in the near future regarding the successful applicants.
As well as that, $30 million in the Regional Infrastructure Program has been allocated, but I have not yet received the commensurate sign-off from the respective state governments. I hope that those governments get on board and realise that communities, as the member for Makin identified, are feeling the impact of these impending closures, and that we are in a position to assist those communities to provide opportunities and infrastructure to assist their workforce affected by this closure.
My question is to the Minister for Industry and Science. Minister, the news last week that Alinta was closing its Flinders power stations—both Playford and Northern, maybe by March next year and certainly by March 2018—has sent shock waves through the Port Augusta community, a city of about 14,000 at the top of the Spencer Gulf, and Leigh Creek, a purpose-built mining town owned by the government 250 kilometres north with a township of about 500 people. In Port Augusta, 185 direct jobs will be lost, and in Leigh Creek, 235 direct employees will lose their jobs. Obviously, many more jobs will be lost with associated contracting industries in the broader community as the ripple effect works its way through.
Last Friday, following the surprise announcement in Thursday's The AdvertiserI think it was intended that the story would go out on Friday, but such are secrets—I met in Port Augusta with the state member for Stuart, Dan van Holst Pellekaan; the mayor, Sam Johnson; Business Port Augusta's David Versteeg; and the council CEO, John Banks. We discussed a range of ramifications that are not immediately obvious, including the loss of a large slice of council rates and the maintenance of Bird Lake. For those who do not know about Bird Lake, Bird Lake fronts up to Highway 1 and is an overflow pond of the cooling system. Significant groundworks have gone in around it to beautify it and attract birds into the area. Of course, if the power station does not exist and water is not pumped, it will dry out and become a stinking mess on the southern side of Port Augusta. The council has also anticipated a figure of almost $6 million that they expect to receive in the next 12 months or so over land development in the area, which would appear to be highly unlikely at this time.
Alinta, as a company, has made an admirable commitment to the nature of its departure from Port Augusta, including fully honouring the workers' redundancy packages, worth $75 million, and spending an estimated $100 million for the clean-up and restoration of both of the Flinders power stations—that is, Northern and Playford stations—and the Leigh Creek mine. They have also committed resources to counselling, career advice and assisting the adjustment of their workers. This company is being a model citizen on this issue, and we could not ask for much more. I thank the minister in particular for meeting with Sam Johnson, the Port Augusta mayor, and the CEO, John Banks, on Monday morning. He also met with a very exciting prospect in the area at the moment, Sundrop Farms, and I thank him for his time and consideration of the issues put before him.
There are two proponents of renewable energy projects in the area at the moment, and the government has a number of avenues from which it may be able to provide assistance, including the Clean Energy Finance Corporation, ARENA and the renewable energy target. I look forward to the further development of those proposals, and of course my door is always open to try to assist them in developing those proposals and to provide any assistance that I possibly can to help them.
The reason Alinta is closing its doors is that it is simply not possible in the current market for them to operate profitably. In fact, they have lost $100 million over the past four years on generation—that is almost $½ million a month. At the same time, they have invested $200 million in the operation, trying to bring it back to profit. All of that capital is now lost. I have been predicting the likelihood of such an outcome for some years in public and in this place and posing the question as to how the South Australian electricity grid would cope if such a situation came to pass. In my opinion it is an entirely predictable and inevitable result of the RET that perhaps got a little bit in front of where it was supposed to be in that it was meant to provide the new generation electricity as renewable into the grid when in fact it has replaced and forced out the bottom-end providers.
I have two questions for the minister. What will withdrawal of the Flinders power stations do to the consistency, reliability and price of electricity in South Australia? And what do you identify as the best opportunities for the Port Augusta community going forward?
I thank my good friend the member for a Grey for his questions, and I am going to be brief in my answer so as to allow further questions. The South Australian energy supply situation is in good shape. As the member identifies, we have a large oversupply of electricity in the national energy market and South Australia's renewable energy penetration is around 40 per cent, which is the second highest anywhere in Australia. Importantly, South Australia is connected to the national grid, which means it can draw power from across the border if it needs to. We need to be mindful of the fact that given the way the grid is managed it should be able to cope with the challenges that may present as a result of Alinta closing.
In terms of the Port Augusta area—and I did enjoy meeting the mayor, a person of great enthusiasm and I have to say optimism in terms of the challenges they are facing—we as a government are investing around $2.2 billion in industry programs, which of course South Australia will be the beneficiary of. As I have just said, we have $155 million in the growth fund, of which South Australia is a significant beneficiary, along with Victoria. Those two states are receiving all of that. South Australia will, as a result of the changes going on, need to strengthen and diversify its economy, and I know that we as a government will work to that and I hope the South Australian state government does the same. In our budget we have provided a significant boost to the small business sector, which includes those small businesses in Port Augusta, and we will work with the South Australian government to put out new opportunities in South Australia.
Minister, thank you for making the time to take my question. Minister, I noted your response to my earlier question. In respect of the Manufacturing Transition Program, can you at least advise how many applications were received from South Australia and Victoria for funds from that program? I appreciate you may not wish to name them, but you might be able to provide a response to the question of how many there are.
Minister, today's announcement that BAE Australia has decided not to respond to the Abbott government's request for tender for the replacement of the Pacific patrol boat is further bad news for Australia's shipbuilding industry. I understand that the company cited the Abbott government's timing of the program as the biggest challenge facing the maritime business. I understand that BAE Australia also said the Abbott government needs to accelerate the Future Frigate Program, along with a plan that supports continuous production.
Minister, what role do you have in the procurement of naval vessels as Minister for Industry? Can you advise whether there will be any effort made to ensure: firstly, that there is not a 'valley of death'; and, secondly, that we stop the loss of skills that are vital to the industry which will inevitably occur if there is not a continuous build of submarines or Navy ships? Finally, can you provide any advice whatsoever in regard to the replacement submarine contract—in particular, whether any decision has been made in respect of who that contract will be awarded to?
I again thank the member for Makin. I will be brief, not through any disrespect to his questions. I cannot divulge the number of applications or the number of successful application in relation to the next generation manufacturing investment program. I will do so when we make that announcement.
In terms of the shipbuilding industry and submarines, we are currently in the competitive evaluation process, which will run for some time as yet; and no decision has been made with respect to whether submarines will be built. As the Minister for Industry, I am involved in the discussions that the government has at a very high level in relation to the shipbuilding industry, and I remain optimistic in terms of its future.
My question is to the parliamentary secretary. As she is aware, the Australian Institute of Marine Science is one of the key agencies in my electorate. It is doing very good work in terms of science based research and work on the reef. Certainly, they are putting out some good facts that counter the extreme Green groups. I am wondering about that agency and other agencies. Will the parliamentary secretary detail how the government is investing in these key science agencies so that we continue to produce world-class research?
I thank the member for Dawson for his question. As we have limited time left in this consideration in detail, I will be very brief, but there are a couple of things I would like to put on the record in responding to the member for Dawson's question.
It is very important to note that we are a government that is committed to world-class research. The Australian Institute of Marine Science is certainly a key agency for this government. We are investing around $9 billion in science, research and innovation across all of the government in this year alone. That is a significant investment we are making.
Briefly, in the time available, I would like to comment that on Sunday AIMS had its open day in Townsville. Specifically, in relation to the member for Dawson, there were a number of people who spoke to me at that open day and who commented very favourably on the very fine work you are doing in the electorate. AIMS will benefit from the government's investment of $169 million over the forward estimates, with funding increasing year on year. That is a very good outcome for the Australian Institute of Marine Science.
There are probably two parts to the work that AIMS does that we need to note. Firstly, it is world-class research work that it is doing. It has some fantastic facilities, based just outside Townsville but also around Australia. It certainly has the SeaSim—the sea simulator—where it is conducting world-leading research on that facility and particularly in marine science. But it is also very much engaged in ensuring that it is providing support to our future scientists. It is supporting the growth of STEM skills in the North Queensland region and particularly in Western Australia. We know that is an area we need to focus on, particularly into the future. Seventy-five per cent of the jobs of the future will require skills in STEM. The Australian Institute of Marine Science is doing a particularly good job in making sure that it is working with the community—as we have seen at the open day—making sure that the future scientists have the opportunity to visit the facility and to engage with the outstanding research scientists there just outside Townsville.
Proposed expenditure agreed to.
Immigration and Border Protection Portfolio
Proposed expenditure, $4,609,577,000
My first words are words of thanks to the department for the way in which they have been able to compile the figures that we see in this year's budget. Obviously, there are a lot of difficulties in trying to manage particularly the case load within this budget and trying to put all of that work together is no easy feat. I pay tribute to the CFO and his team, to the secretary, and to the senior leadership within the Department of Immigration and Border Protection. I want to also pay tribute to people within my own office who have worked diligently through this budget process.
The government was elected, only less than two years ago, on a very clear mandate: to make sure that we address the concerns that the Australian public rightly expressed in relation to the loss of control of our borders. And for Australia, an island nation, the fact that we had lost control of those borders was of great concern to all Australians. For a long period of time, Australians from all walks of life, have expected their federal government to be in a strong position in relation to border management and to conduct a program in an orderly fashion. As we have said before, publicly, the fact that 50,000 people came on over 800 boats signalled very clearly to the Australian public that the Labor Party had lost control of our borders.
The challenge now for the government, of course, is to not only clean up that mess and to address it in an effective way but also provide a humanitarian dividend. I am very proud of the fact that in this budget we have been able to further detail the increases in the refugee and humanitarian programs, to provide extra support at the same time as we are closing down detention centres to people across the network so that we can provide a humane environment. We have, quite literally, been able to provide a financial dividend in this budget as well.
I am pleased we have been able to give money back so that the government can address other priorities, for which we were elected, including support in this budget for small business, child care, pensioners and others. It is incredibly important that we have been able to do that because the feat that we faced when we came into government was an $11 billion blow-out in relation to these border protection matters—and that was, of course, unacceptable.
We have a number of measures in this bill. Not only have we been able to provide that $500 million dividend but we have also been able to put extra support into biometrics. One of the most important priorities for this government over the coming years will be to ensure and enhance integrity within our visa programs. It is very important for us to be able to deal with trusted traders. It is very important for us to be able to deal with people who would pose a threat, both at our borders here if they arrive at our country and also further afield where we have been able to deploy people at certain airports.
These are very important measures contained within this budget. As I have said publicly before, we have been able to close down some 13 of the 17 detention centres. That has resulted in a direct dividend allowing us to fund, for example, Counter-Terrorism Unit officers at our airports. We now have 80 staff across those airports. Why is that important? As all Australians now understand, the threat from terrorism to our country is as high as it has ever been in our country's history. The fact that we have 400 high-priority cases under investigation by ASIO right now, the fact that we have 110 or more fighters from Australia in the Middle East and the fact that we have 150 people or so who on our shore are preparing or supporting those who would seek to do us harm underscores the fact that we really do need to provide additional support through this budget.
We have been able to do that because of the success we have had with Operation Sovereign Borders. I want to commend all of the staff particularly in Operation Sovereign Borders but across the department for the sterling work that they have been able to do over the course of the last 18 months or so. This budget provides us with the foundation to support the change management that is taking place within the department and the additional training that is required to support our staff as we move to not only enhance the integrity of our visa system but make sure we have the appropriate measures at our borders.
The first question I would like to ask of the minister is in relation to that initial comment that he made around keeping our borders secure. It relates to the matter which has been in the public eye since last week. This time last week an extraordinary allegation was put forward by people in Indonesia that they as people smugglers had been paid by Australian officials to take the asylum seekers on board their vessels back to Indonesia. This seemed at the time an extraordinary allegation. To be honest, when it was made, I did not take it seriously. There are a lot of allegations made in this area, as I am sure the minister knows, that turn out not to be true. The minister very quickly denied the government having paid any money to people smugglers to take their passengers back to Indonesia. Again, to be honest, that made perfect sense to me. That was last Tuesday.
Last Friday, we had the Prime Minister give a pretty astounding interview with Neil Mitchell on 3AW where he seemed to allow the possibility that this may have actually occurred and, in a subsequent press conference later that day, really invited all Australians to believe that this was precisely what occurred. My question to the minister is obviously whether or not this did occur and whether he stands by the comments that he made originally that this never happened. These were comments which made sense because the idea that you would be paying people who belong to a criminal network to undertake behaviour which would, in essence, create something of a pull factor makes no sense at all. It makes no sense that you would send a message to people smugglers that it is possible to come up next to an Australian vessel and there would be a fair chance that you would get a wad of cash paid for by Australian taxpayers. This would seem to me to be creating a new business opportunity for people smugglers in the context of a set of circumstances in which I think, in all sincerity, both sides of politics have been working over the last few years to try to remove the business opportunities of people smugglers.
This is a very dangerous development, if this is in fact what has occurred. It is very much in the public interest that we get an answer to this question. I note that, in response to questions of this kind over the last 48 hours, the government has been invoking the fact that that these are operational matters and security questions and there is a long-held precedent that governments—indeed, both sides of politics—should not respond to questions on intelligence matters. Ultimately that is not good enough, because that was not invoked at the time that the minister very clearly gave an answer last week that this did not occur. It was not invoked back then. It seems to me that it is being invoked now with a view to try and make sure that this question does not need to be answered.
I also note that the government has been busily out there, talking to various media outlets and backgrounding them on the operations, in fact, of security agencies—I have to say that in my mind it is utterly appalling that that has been put into the public domain—which has then raised questions about whether or not there were any actions of this kind that occurred when Labor was in office. Of course, we would not answer questions in relation to the activities of our security agencies, and they are not the questions that I am asking of the government or the minister this evening. But I would absolutely make this point in another context: there would be security agencies and police organisations around the world who pay informants to infiltrate criminal networks. That is a very different question to one of paying a criminal network to do a particular job. That is the question that is at hand here, in terms of the conduct that occurred last week. If the allegations are true—and the Prime Minister is not ruling them out, which of itself seems to us to be a strange message to send people smugglers—then this government has been paying criminal networks to undertake a job. We need to hear from the minister now that that did not occur.
This week is Refugee Week, and in Cowan I have a very diverse community consisting of people who have come from many places around the world. I think it is a testament to the success of Australia as an immigrant nation that so many have come and that so many have made wonderful contributions to the nation and communities such as in the Cowan electorate.
In my area, we have many examples of people that have come as refugees from other places, people that have fled in desperation from harsh conditions and personal risk. I know a former refugee that fled by camel from Iran and registered with UNHCR across the border in Pakistan, I know people of Vietnamese origin that came to Australia after being in the refugee camps at Hong Kong in the years following the Vietnam War, I know people that came from refugee camps in Africa and I know people who have lived for years in the refugee camps in on the Burma-Thailand border—camps that I have seen with my own eyes. When I saw the conditions in such camps and I saw how desperate the conditions were, it was easy to be moved by that experience. That is where my sympathy lies: thousands of people with a mere handful of dollars, a meal a day, subsistence conditions at best, yet more typically borderline starvation. I saw it in the eyes of those refugees. They had lost hope that their nearby homeland could be safe from brutality, landmines or persecution. Instead they wanted a future where their children had a chance for an education and a future of safety. With that loss of hope, they replaced it with the dream of the future in the land of opportunity, Australia. It is the land of opportunity, because this is a country where your success is determined by the content of your character and your determination to harvest the proceeds of your hard work. This is a place where you can come from having had nothing at Mae La shelter near Mae Sot in Thailand. If you are prepared to work and get a job, the road to that opportunity is being paved by our policy of border control.
I am therefore delighted that our humanitarian intake is now determined by need rather than cash. I say this because, after Labor changed the working immigration policy in 2008, the intake became entirely about cash and not need. I make the point that those who came by boat had cash to pay the people smugglers. Those from the Middle East had also already flown on an aeroplane to get to the people smugglers. Again, cash and means differentiated them from those in refugee camps.
I hear the fans of unfettered boat arrivals saying that there is no queue where these people come from, and that is absolute rubbish. UNHCR and the IOM have officers and representatives in many places that those who come by boat have bypassed. While Labor was letting people arrive by boat with their weak policies, those who were stuck in refugee camps waited longer and longer. While those who were heading to Indonesia were checking out duty-free options at Doha or Dubai airports whilst waiting for their Jakarta connecting flights to depart, refugees in camps were wondering whether they could eat today or get their children some clothes. As the camp kids were kicking a worn soccer ball through the dust of the refugee camp, Labor's preferred intake was handing over wads of cash or transferring thousands of dollars to bank accounts as they prepared to hop on a boat to Australia or, better still, a planned interception by the Australian Navy so they did not even need to come the whole way.
But what a contrast it is now. Since this coalition government was elected, the refugee intake goes to those in most need: persecuted and at-risk women and children; Christian refugees from the war in Syria; and those from the Burma-Thailand border, the Karens and Chins—people who know how to work hard and who are determined to succeed, just like the refugees we took from Europe after World War II or after the Vietnam War. The many refugees we took are almost entirely from refugee camps in Asia.
I know that those in the Labor Party want to return to a means-over-need system, just like the Greens. I have seen enough in this world to know that the fair way is not to accept those who step ahead with cash but always to remember those who are stuck behind the barbed wire of refugee camps and those who have a great record of fitting in and working hard when they get to Australia in the right way.
So, Minister, this is the big issue for me with regard to border security. While the Labor Party and the Greens want to whinge about the outcomes on Nauru or Manus Island, created entirely by their polices and the way in which they threw away those facilities in 2008 and then rushed to re-establish them in 2012, we are now dealing with those policy disasters. Above all I see that at last with us, those refugees with the greatest need are the priority and that Labor's disgraceful cash-over-need priorities are at an end. Therefore, Minister, I ask you how the government is restoring integrity to the humanitarian program in the budget and what will happen if Labor returns to government?
I want to address some of the remarks made by the honourable member opposite and then address the remarks of my learned colleague from Cowan because I think the two issues obviously dovetail together.
To go to Mr Marles's question first: I think, frankly, what you have seen tonight can only be described as an embarrassing performance. We had question time today, where not one question was asked by Mr Marles in question time—not one. There was not one question in relation to this issue. Yesterday, this was the biggest issue that the Labor Party had, and today there was not one question. We come to this place to talk about the budget, to talk about the money that we are putting into this particular program—
Madam Deputy Speaker, I raise a point of order. In this place, as in the House, it is the responsibility of the speaker to refer to the member by their seat and not by their name. I would have thought that the minister would be well aware of that after the length of time he has been in this parliament.
Thank you. I ask the minister to refer to members by their proper titles.
In 14 years, the honourable member has yet again made another memorable contribution. There have been many over that period of time that I can recall, particularly in relation to health, and she has again excelled herself tonight—perhaps even peaked. Well done.
The point that I would make in relation to Labor's claims here is that this government—as I have pointed out publicly and as I pointed out in my earlier response—had a mess to clean up. Operation Sovereign Borders has been a success for a number of reasons, because we have been able to maintain operational integrity. We have been able to work with people of the quality of Lieutenant General Angus Campbell and, now, Major General Bottrell, with a very professional team beneath them. The work that Admiral Mike Noonan and others do within the command is world-class.
These are people who dedicate themselves to border protection and to the security of our nation, and they should be honoured. They lead a team of people within Operation Sovereign Borders, and any suggestion that they act outside of the law is an affront to them as much as it is to me. I believe very strongly that Labor, in their whispering campaign—in the most appalling press conference today that I have ever seen the Leader of the Opposition take part in—and in the fact that they did not ask a single question about this in question time today, show that they still do not grasp what is required under Operation Sovereign Borders.
The reason all of that is important is that, as the member for Cowan rightly points out, because we have been able to resurrect some integrity within the program, because we have been able to address the fact that the people smugglers were financed to the tune of over half a billion dollars by Labor when they were in government, the fact that we have broken the business model of these people smugglers, the fact that each day we continue through Operation Sovereign Borders to stare this threat down—the fact that we can do all of that is exactly the reason that we can deliver support through other programs, including to people within the electorate of Cowan.
I know a lot about the member for Cowan. He has served his country with great distinction. He has served his country not only in uniform but in this place as well. He reflects the aspirations within his own community. He provides an amazing amount of sympathy and connection with those people who have been able to change their lives forever, as he quite aptly put before, in terms of the life journey that they have embarked upon out of camps and into parts of Western Australia to create a new life. That is something our country should be incredibly proud of, but we do not have that human dividend if we allow Labor's dysfunction to return. We will do whatever it takes within the law and our obligations to international treaties to make sure that the people smugglers stay out of business. I can advise this parliament and the Australian people that all of the advice that I have is that these people are trying their best to restart their business and they are rubbing their hands together at the prospect of a Shorten-led government. We will not allow that to happen.
We will not allow the people smugglers to recommence their terrible trade, because under Labor 1,200 people drowned at sea. We have been able under this humanitarian program to increase the places by 2018-19 out to 18,750, and it means that we can get the human dividend that the member for Cowan so appropriately spoke to before.
Perhaps I will take up the last few comments that the minister made in his answer in terms of that accusation of 1,200 people dying on Labor's watch. I would also make the point that more than 650 people perished after the coalition teamed up with the Greens to see that the Malaysian arrangement which had been negotiated never came to pass. That was an arrangement which would have seen hundreds of people returned—in effect, hundreds of people turned around. You have here a government which claims that the only step that was ever taken which made a difference to the flow of asylum seeker vessels was their policy of turnbacks. If turning people around is what has made the difference then by the government's own logic, had they supported Malaysia more than two years ago, this all would have been brought to an end much earlier. But what we see from this government in this area of policy is always a rush to politics ahead of policy.
I also say that the minister made the observation that a question was not asked of him during question time today in respect of whether or not he still stood by his comments of last week, when he denied that any money was paid to people smugglers. I am not sure it would have made any difference if a question had been asked of him during question time; when I have asked the question of him tonight, he has resolutely failed to answer it. In fact, he went absolutely nowhere near it. So asking questions of this minister rarely yields a straight answer.
As the minister has sought to invoke generals Campbell and Bottrell, I also place on record that they are both fine servicemen who have made an enormous contribution to this country in every role that they have performed. We have nothing but the highest admiration for the work that they have done, and nothing that we have ever said would seek to impugn the work that General Campbell and General Bottrell have done. I think it is particularly appropriate that that gets raised in this context.
On another matter, I do want to raise the question of the proposed citizenship legislation and ask the minister when he intends to introduce a bill and when he intends to talk to the opposition about it. This is a proposition which was first put into the public domain by the government more than a year ago when then Minister Morrison raised the prospect of stripping dual citizens who had been engaged in terrorist activities.
From the point of view of the Labor Party, we do think that there is a principle which is contained in the act right now which sees that, if somebody does take up arms against Australia, their citizenship is cancelled. That is in the construct of a traditional state-on-state fight. We think it is appropriate that that be updated to take into account a phenomenon such as ISIS, along with making sure that people are not rendered stateless. We have made that clear. But the only document we have seen from the government is a leaked question time brief in which there are eight key points—three of which are about the Labor Party. The phrase 'national security' does not appear among them at all. It seems to us that the focus from the government's point of view is, again, much more around politics than what is a critically important piece of policy.
We see a government that is utterly divided both in its cabinet and its party room. We saw the minister, I imagine, take legislation to the cabinet and get rolled. We then saw his predecessor come out and try to clean up with a compromise proposal. We have seen 40 backbenchers petition the Prime Minister and, in a sense, stand over the cabinet to act in a particular way. Then we have seen Senator Cory Bernardi from the other place try and inject himself into this whole debate almost as the voice of reason—which just shows that we are absolutely looking through the looking glass when it comes to this whole episode.
Where that leaves us, though, is with government members scrapping, like kids in the schoolyard, around a profound piece of legislation. It is hard to think of a more important piece of legislation for any country than the legislation that provides for its citizenry. There is nothing more important—it is a paramount obligation—than that a government provide for the safety of its citizenry. In respect of both of these, we see a government which is treating national security with contempt and treating the Citizenship Act with contempt. The question of the minister is simply this: when are we going to see a bill and when are we going to get briefed on it?
This is a very serious issue, so I am happy to take the question. My understanding from the Leader of the Opposition is there was in-principle support for what the government is proposing here. I presume from the member for Corio's contribution that the opposition is stepping back from that position. I think that would be regrettable.
There has been, in relation to a number of national security issues, some consensus between the government and the opposition. There has been no departure whatsoever in this debate from the government's perspective in relation to the process that has operated in relation to other bills, including national security bills. The normal course of action, whether it is the Liberal Party or the Labor Party in government, is that the bills would go to the caucus—or, in our case, the party room. The bills would go to the backbench committee, or whatever process Labor had preceding that, and then the bills would be introduced into parliament. At that time, there is consultation that takes place with the opposition. On advice available to me, that has been the standard process. Nobody is suggesting there should be a departure from that process. We do want to engage constructively with the opposition in relation to this matter. I am desperately concerned that, in the run-up to the Labor Party conference, sensible voices within the Labor Party will be drowned out by some of the more dramatic ones on the Left. I am sure the sensible voices sit opposite us. The difficulty in that environment is that it may drive the opposition to a position which is less than desirable.
This is a very serious bill that we bring forward with appropriate safeguards. We have said publicly, and I confirm it here again tonight, that the government's intention is to introduce the bill in this sitting fortnight. Nothing has changed in relation to that. Once the bill has been put into the parliament, my presumption is that it will be referred to the intelligence committee. There are Labor and Liberal members on that committee. I think that is an appropriate area for it to be referred to. We will provide briefings as appropriate to the honourable member opposite, as well as, I presume, to the Leader of the Opposition and the shadow Attorney-General.
We are happy for that process to take place. But any suggestion that there has been a departure from that longstanding convention is quite wrong. We will provide the appropriate briefings at the right classification and at the appropriate time. That is what we will do because there is an absolute determination by the government to make sure that, where somebody is a dual citizen and they are a terrorist, we do not render that person stateless. All of those principles, for which the Labor Party have publicly stated their support, will underpin our approach. We will conduct ourselves accordingly with the opposition and that will be, I hope, a productive discussion. But there is no departure from the process that would normally be the case in relation to national security bills, I am advised.
I hear what the minister has said in answer to the question, and obviously we welcome it if there is some certainty that this bill will be introduced in this sitting fortnight. I would remind the minister that two weeks ago the Prime Minister said that the bill would be introduced within the next couple of weeks, which at that point meant that it should have been introduced on Monday. Instead, what we are seeing is the bill being dragged out and out. One imagines that the reason for that is that what has characterised the debate in relation to this is not so much trying to find consensus between the government and the opposition but trying to find some form of consensus amongst the government itself, which it appears has been very difficult to do. One imagines, given the reports we have heard that it did not even make it to cabinet on Monday night, that we are still battling to see whether or not that consensus can be found within the government.
The minister referred to 'normal practice'. He assured this place that there would be no departure from normal practice in relation to national security matters. I would have thought that, in respect of normal practice when it comes to national security matters, what ought to characterise that is bipartisanship—constructively working together in the national interest for our national security, which, despite the bleating of the government, is something which is held just as dearly, taken to heart, on this side of politics as it is on the conservative side of politics. We will stand up our record over the decades since Federation on that question against those on the conservative side any day of the week.
An honourable member interjecting—
Absolutely not. What the minister needs to explain now, in the context of there being no departure from historical practice here, is the meaning of that question time brief. There are eight key points and three of them are about politically positioning Labor. The words 'national security' do not appear in it at all. This is all about a political document, and from what we have seen, from former minister Morrison flying a kite on this issue last year to the various backbench members who have been flying kites ever since—including the member for Bass, I think, and the member for Wannon—and the various comments that we have heard from both the Prime Minister and the minister aimed very much at positioning the Labor party, it is all about politics.
I just want to ask the minister: how does that fit within the historical precedent, the historical practice, of bipartisanship, with both sides of politics working together on an issue of national security? There are some key questions here. We want to know: how does this legislation work or how is it proposed to work in terms of reconciling it with the foreign fighters legislation which was passed last year? The thing is, part of the foreign fighters legislation was granting the ability or empowering our country to prosecute people for having committed terrorist acts by virtue of their citizenship. If you remove citizenship from people, it raises the question: will that still enable us to pursue people in the way that the foreign fighters legislation was enabling us to do? It is a reasonable question. Maybe the government has a really good answer for it; we would just like to have that conversation. We want to make sure that there are no unintended consequences of this legislation, and I am sure that we can have a very reasonable conversation with the government about that.
But in circumstances where there seems to be advice from the Solicitor-General suggesting that this legislation may be unconstitutional, where we have the author of the report which was the basis for these reforms, Bret Walker SC, the former Independent National Security Legislation Monitor, saying that he thinks the advice he gave in that report has been misunderstood by the government—all of these raise really significant questions. There is a perhaps even more fundamental question than that. It goes to ensuring—and I am sure the government shares this concern—that this legislation does not lead to the perception out there that there are two classes of Australian citizens. Obviously an enormous number of our population have dual citizenship. They need to be considered in this as well. That is the conversation we want to have, and we want to know when we will be able to have it.
I am surprised to hear those comments, Minister, given what I saw when I was elected to this place in 2007. We see a very different position taken by the opposition at this time, given their celebration around the dismantling of what was a very successful border protection policy at that time. We even heard a particular Labor member at the time describe a detention facility as, I remember, a white elephant. Unfortunately this was prior to their changing very successful border protection policies, which led not only to 50,000 arrivals but also to 2,000 children in detention—where there had, I think, been none and only a handful of people. We have seen hundreds of boats and at least 1,200 deaths at sea.
I take very seriously—as you did, Minister—what you referred to as a whispering campaign and a reflection on the defence forces. I take that seriously, particularly given the huge workload that they had to absorb during those dreadful last six years of Labor. I saw it firsthand, because I made it my business to go and see what they actually had to deal with. As a daughter of a war widow, I take the responsibility of what we as a parliament ask them to do extremely seriously. I saw the workload that was visited upon them because Labor basically reinvigorated the people smugglers' business model. Not only did we see millions of dollars go into the pockets of those people but also we saw very tragic deaths at sea of people taking extraordinary risks on leaky boats, encouraged by those very policies. Minister, Operation Sovereign Borders has stopped the boats, ended the deaths at sea and regained control of Australia's borders. How does this budget build on this very successful policy and the efforts of this government?
I thank the honourable member very much for her contribution and I pay tribute to the way in which she has conducted herself in relation to this debate and, in particular, her deep and sincerely held views, thoughts and care for members of our defence services. In Nola Marino you have a local member who really concerns herself very deeply about these issues—particularly where there was a significant impact on the naval staff, on other members of the defence force and on members of Customs and Border Protection during the period when Labor was in government. It must have been truly horrific for those staff to be literally pulling from the water bodies who had been half-eaten by sharks and had drowned in dreadful circumstances. As the honourable member rightly points out, 1,200 people in total, that we know of, lost their lives at sea when Labor was in power. It is beyond me, and I think beyond all of my colleagues here tonight, why Labor would want to revert to the failure that resulted in deaths at sea, an $11 billion blow-out and those 800 boats coming. Ultimately that was driven by the fact that half a billion dollars under Labor was put into the pockets of people smugglers. It was a truly shameful period of Labor maladministration. We have been able to turn back boats where it has been safe to do so and introduce temporary protection visas. Those two measures in relation to Operation Sovereign Borders—and other measures, but in my judgement primarily those two measures—has resulted in the success we have seen with Operation Sovereign Borders.
As the honourable member would know, there is an internal blue going on within the Labor Party at the moment. There is one almighty fight going on between the Leader of the Opposition and the Deputy Leader of the Opposition in relation to turn-backs where it is safe to do so. The National Conference of the Labor Party is coming up. If we need to understand why Labor cannot adopt the successful Operation Sovereign Borders strategy, we need to understand what is happening internally. Again, I do think there are sensible voices within the Labor Party who are begging and pleading those on the Far Left of their party to come to a sensible centre, to adopt the success of the Liberal government. I honestly believe that. I have no evidence of it but I suspect it. I offer support to those people who might be appealing to the better side of their colleagues on the Left, but I suspect, sadly, that the Left is going to prevail. And, if the Left prevails, as they did during the Rudd-Gillard-Rudd years, we will see deaths starting again at sea if Labor is re-elected at the next election. We will see those 50,000 people coming on boats again. We cannot allow that to restart. As the honourable member pointed out in her question, we cannot allow it to restart for a number of reasons, primarily because of the impact that it has on our personnel. We do not want to put our personnel into that situation and, under this government, we will not do that. That is our commitment to our defence personnel. It is why we have repeated, on a number of occasions: if you cannot control your borders, you cannot control national security. Labor did lose control of the borders. We got control of the borders back and we are doing all we possibly can at this time of heightened threat of terrorism to keep the Australian public safe.
All of the briefings that we receive in the National Security Committee of Cabinet and all of the advice that we receive from the intelligence chiefs say to us that we are living in a very different time and we need to stare this threat down. This government, as the Prime Minister has demonstrated from day 1, commits us to making sure that we do not return to a loss of control at our borders or a loss of control in relation to national security matters, particularly given that Labor ripped out hundreds of millions of dollars from those programs. We in government have been able to restore a lot of funding to our agencies to make sure that they can stand up to this current threat. That is what we do within this budget. We provide additional funding, as I said before, around biometrics in relation to a number of other programs but including, importantly, Operation Sovereign Borders so that we make sure that we never revisit a situation where people are drowning at sea and where our naval and our Customs and Border Protection staff are subject to that sort of horrific scenario.
Minister, it is well known that under the Rudd-Gillard-Rudd Labor-Green government more than 800 boats arrived carrying more than 50,000 people. It is also widely known that the complete loss of control of our borders cost the Commonwealth around $12 billion. I believe it is also fairly well understood that more than 1,200 lives were lost at sea in the scramble to reach Australia and that Labor built more immigration detention beds than they did hospital beds during their time in government. The big-picture stuff and the headline numbers are known because, when under the Labor government, every time you thought that things could not get any worse, things did get worse, and they did so very quickly. Every time things lurched from tragedy to farce, it was all over the news.
What might not be as widely understood is the effect that this chaos had on various communities, including my own in Solomon. By the time the negligent Labor days were drawing to a close, there were five immigration detention facilities either in Solomon or just outside. Chartered jets streamed in and out of Darwin airport on a daily basis, each flight costing the taxpayer tens of thousands of dollars as detainees were shuffled from centre to centre in a desperate juggling act. New centres were commissioned and built in the area around Darwin. They filled up instantly and more centres were built at enormous cost to the Commonwealth. The immigration industry in Solomon was a monster which crushed other businesses. The tourism sector was swept aside as the government booked up all the available accommodation. An entire motel in Darwin's central business district was leased by the Department of Immigration as a place of detention. Several others were leased in whole or part to immigration contractors and to departmental staff. This drove the cost of rooms up for tourists and meant fewer people were visiting my electorate for holidays.
For businesses in the restaurant industry, there were fewer diners at their tables. Tour operators also found fewer people taking up their tours. As I said, accommodation cost was a big driver keeping people away. The fishing charter operators had fewer people on their decks, and some longstanding and well-established businesses went to the wall.
Minister, it has not gone without notice in my electorate that 800 boats arrived under Labor's tenure and, to this day, 648 days into the coalition government's tenure, only one boat has arrived—one compared to 800. Things are improving in Solomon. The hotel industry is once again serving tourists. Some of the detention facilities around Darwin have been closed, and it has been reported that $16 million in lease costs alone were saved when Blaydin Point was closed.
So my question to you, Minister, is: how has Operation Sovereign Borders helped the government achieve savings of $558 million in the budget, through management of the immigration detention network?
I thank most sincerely the member for Solomon. She comes from a garrison city, and she knows personnel from Defence and the Customs and Border Protection Service very well. It is hard to think of a person who has been more passionate in this place about the Defence Force and about the way governments provide support to Defence and Australian Customs and Border Protection Service staff than the member for Solomon—I pay tribute to her—and it is no surprise that she would ask this question tonight about this very important issue.
We have been able to return that $558 million dividend to the budget. Labor's $11 billion blow-out in government was completely unsustainable, as the member for Solomon points out. This government is determined to continue the good work that we have started. We continue to stare down this threat every day. We know that the people smugglers are there; they are trying to put ventures together right now. We have been able to turn back boats where it has been safe to do so, and that is the absolute secret to our success. It seems that the Labor Party will never be able to bring themselves to do that.
People should not forget that before the last election—as the member for Solomon well remembers—and indeed before the 2007 election, Labor promised up hill and down dale that they would stop the boats, that they would be John Howard light, that they would not change anything in relation to border protection management. They promised that before the election. Let me make this prediction: they will make the same promise before the upcoming election. They will say that they have put in place a new package. The member for Corio will say that he has been around the world talking to the UNHCR and having cups of tea elsewhere, looking at global and regional solutions. There will be some big picture he will paint about how the Labor Party will preside over success in this area. Do not listen to what Labor says; look at what Labor does.
There were no children in detention when Kevin Rudd came to government in 2007. At its peak Labor had almost 2,000 children in detention in our country. Today that number is closer to 100, and we work each day to try and reduce it even further. That is what we do and that is what we continue to do. I pay tribute to the member for Solomon for being such an integral part of supporting our personnel, which ultimately results in success under Operation Sovereign Borders—and indeed in the measures that we put forward in this budget.
Once again, what we have heard from the minister is a focus on politics and not a focus on the policy. We hear numbers being recounted by the government members and by the minister himself; a complete focus on that. We hear the claim that all the sins of the past belong to one side of politics and the claim that all the credit for the present belongs to his side of politics.
Let me make this completely clear: it was the coalition, in combination with the Greens, that voted against the implementation of the Malaysian arrangement, which prevented it passing through this parliament. It was an arrangement that would have provided for the return of 800 people. We do not know how many people have been returned via the turnback policy of this government, because it is conducted under a shroud of secrecy. I think it is safe to say that, when we were talking about the return of 800 people—by the logic of the minister that you just heard as to the key step in putting an end to the five asylum seeker vessels—had the coalition worked with Labor back then to see the Malaysian arrangement implemented, then we could have brought this to an end years ago.
I will tell you why that did not happen. It did not happen because the last thing that the coalition wanted to happen was to see this issue resolved under Labor's watch. In that respect, there is a very different circumstance now. What the government enjoys is an opposition which absolutely wants to see an end to the five asylum seeker vessels from Java to Christmas Island—we absolutely want to see that. We have been doing everything we can to work with the government in that regard. That is something that this government enjoys, which the former Labor government did not enjoy. The coalition teamed up with the Greens to vote down the Malaysian arrangement. Since that time, we have seen more than 650 people lose their lives at sea and thousands of people come to Australia. If you want to have a proper and serious conversation about the sins of the past, that is a question that needs to be examined very closely. What was the rationale stated then? Malaysia, the coalition insisted, was not a signatory to the UN Refugee Convention. Of course, now the policy of turning boats around is about turning people back to Indonesia, which also is not a signatory to the UN Refugee Convention.
Who could believe for a second the rhetoric that was used by the coalition back then when everyone sees the way the coalition conducts itself in office now? You simply cannot reconcile the two, and that is why you will never hear the coalition talk about what they did in relation to the Malaysian arrangement years ago. You will never hear that pass their lips because it is inexplicable, given the way the government acts now.
The other point to make is this, and this is a matter of public record: 90 per cent of the flow of asylum seeker vessels stopped after the regional resettlement arrangement was entered into by the then Rudd government on 19 July 2013. Without any change in the policy settings at all right through until December 2013, we saw that flow remain at about 10 per cent of what it had previously been. If we are going to talk about who gets credit for putting an end to the flow of asylum seeker vessels, any sober analysis must realise that the most significant step taken by any Australian government in bringing an end to the flow of asylum seeker vessels from Java to Christmas Island was the regional resettlement arrangement, which was entered into by the Rudd government.
The fact of the matter is that this kind of politicking is what we need going forward if we are to have an enduring resolution to this. I am not talking about one that will last a year or two, but one that is for the next decade or two. We need to be working together on this. It is why we have to see an end to the constant politicking on the part of the government. I will make this commitment now: nothing you might see in a future Labor government would remotely entertain the possibility of re-opening that journey from Java to Christmas Island. We want to see it ended, and it has ended.
It is without doubt that immigration and border security are two of the most complicated and emotional topics in our national debate to date. In my electorate, constituents are concerned with how we are managing our border, how we are processing immigration cases and how strong our borders are in relation to human-trafficking, illegal arrivals and domestic or international security alerts.
When the coalition came into power we inherited a mess that saw countless lives lost at sea, endless people-smugglers selling false hope to the most vulnerable and other deplorable tactics with no regard for human life. To have done nothing would have been an assault on our constitutional values and detrimental to our policies. The inception of Operation Sovereign Borders has meant that there have been no unauthorised maritime arrivals in over 300 days. This is something the coalition is proud of and something about which my constituents have contacted my office to relay their support, as many of them were very distraught at images of men, women and children dying at sea.
The only way to ensure no further lives are lost is to ensure our borders our secure. Our Constitution states that we have regulated borders—not open and not restricted, but regulated. Unfortunately, people-smuggling is a lucrative business that enables its operators to profit enormously at the expense of its victims. It is our duty to ensure lives are saved. In order to do this, Australia has to strengthen its operational capability to protect the asset that defines our nation as a sovereign state, and that is, our borders.
Our existing framework has been vital to protect our citizens and our gateway for trade and business, but recent events, domestically and internationally, have demonstrated that even though the existing framework is viable, it cannot guarantee to continually safeguard the integrity of our border security well into the future. That is why amendments are so necessary, so we can get on with the job of protecting our citizens whilst preventing human-trafficking and people-smuggling ventures. Amendments such as those to the Migration Act 1958 allow for simplification and streamlining in the collection of personal identifiers to allow for digitisation of biometrics during the customs process to better verify the true identity of an individual.
The introduction of bills such as the Migration and Maritime Powers Legislation Amendment Bill 2014 has been one of the most integral components of the coalition's plan to restore confidence, certainty and integrity to our immigration and border protection arrangements. Barton constituents believe it is crucial that we maintain the integrity of our asylum seeker policies so that we can process as efficiently as possible those most vulnerable and in need, while resettling those who face genuine persecution. We must be able to process claims quickly whilst allocating appropriate resources to individuals with more complex claims.
Barton constituents, like many Australians, support the government's key strategies for combating people-smuggling and managing asylum seekers both onshore and offshore. Barton residents believe in the concept of robust immigration and border protection policies. They want Australia to be a safe country in which to live, to raise their children and to go to work, whilst at the same time ensuring our borders are safeguarded against those who wish to flout the rules against businesses wishing to make a profit out of the misery of others and for the government to remain steadfast to our election promise to restore integrity and security to our nation's biggest assets, our sovereignty.
As I mentioned earlier, people-smugglers operate flexible models and should any of these be thwarted they will rapidly adapt. It is logical, therefore, to have our law enforcement policies adapt efficiently when the need arises. Integrity is paramount to our immigration and border protection policies because this is in the best interests of our citizens and lawful non-citizens.
Prior to the coalition coming into power, under Labor's disastrous policies and inaction we faced a real prospect of systematic weakening of our borders due to the increased challenges we faced with regional and global crises. We have a framework that was systematically dismantled under Labor which saw an increase in illegal maritime arrivals and people-smuggling ventures. The inaction under Labor had disastrous consequences for Australia and no-one—certainly none of my constituents—wants this to be repeated.
I take this opportunity to ask the Minister for Immigration and Border Protection to explain how the standing up of the Australian Border Force on 1 July helps to protect our borders.
I thank the honourable member for Barton for his contribution and recognise his longstanding service to his local community as a local mayor and a very successful small business person, as well as the great contribution he makes in this place. He talked about a very important issue, and that is the standing up of the Australian Border Force from 1 July. I want to say congratulations to Roman Quaedvlieg, the commissioner-in-waiting. He is an outstanding public servant and a man who has given effectively his whole working life to the betterment of our community. He is going to be a fantastic appointment to that position. I want to say thank you very much to him and his team and to the secretary, Michael Pezzullo, as well as all of the senior management team, for the work that they have done in preparation for the standing up of the Australian Border Force. It will be a watershed moment in the history of border protection in this country and we are very happy to provide funding for it through this budget.
Proposed expenditure agreed to.
Debate adjourned.
Federation Chamber adjourned at 21:00