Sky PM Agenda
Tuesday, 8 April 2014

SUBJECT/S: Free Trade Deal Japan and Australia; Labor Party Reform.

DAVID SPEERS: More now on this trade agreement struck with Japan or finalised with Japan. Let's hear from the opposition the shadow Minister for agricultural Joel Fitzgibbon is now with me in Canberra. Thank you for your time.

From what you have seen of this is it a good deal for Australia?

JOEL FITZGIBBON, SHADOW MINISTER FOR AGRICULTURE: We do genuinely from opposition try to take a bipartisan approach to these things David. This is Australia negotiating with the rest of the world and the last thing you want is an opposition party running interference but as the day goes on and we get more and more information about these arrangements, I’m finding it more and more difficult to defend it to be frank. I have not seen one agricultural representative body today give this agreement the tick of approval.

SPEERS: I guess those groups though, and you’re are right, the cane growers, the rice growers, dairy, pork producers and the cattle council have all basically said we wanted more. They would all want more wouldn't they, but it is better than the status quo

FITZGIBBON: Well you would expect them to of course say they want more. But I mean the cane growers for example got next to nothing or indeed nothing, the dairy farmers got very very little, a few changes to the quota’s but nothing really substantial on tariffs.

SPEERS: Well cheese gets something, they get a higher quota

FITZGIBBON: Well they get a higher quota so at the moment it’s something like 27,000 tonnes goes in without a tariff but after that you pay the tariff and that will go to 47,000 over many years. However, I’m not sure that Australia gets to fill all of that space that might be an increase for other country or trading partners as well so I need to check on that one, I think that is one of the reasons that the dairy industry is pretty unhappy.

SPEERS: And the sugar growers thou they do get a lower tariff on the international grade sugar.

FITZGIBBON: - grade.

SPEERS: Which is not what Japan buys admittedly but could they, if there is cheaper Australian sugar at that international grade available they could start..

FITZGIBBON: Oils ain’t oils and sugars ain’t sugars and the cane growers have expressed their view and they have done it in a most robust way. George Christensen one of the government’s own back benchers who represent a sugar seat has been pretty forthcoming.

SPEERS: pretty (inaudible)

SPEERS: What about beef though. They do get something. Admittedly it’s over some years but even in the first year those very high tariffs do come down 9, 11% for frozen and chilled beef.

FITZGIBBON: Well frozen and chilled are 6 and 8 % in the first year - you could argue a substantial decrease. But they still get stuck at around 19, 20% in the out years and this is a reduction over 15-18 years. So this is a long time coming. So no I mean it's an improvement and we welcome that. But no wonder they are unhappy and oh course unlike other international instruments, the tariffs never get to zero. So at this stage the best they can ever hope for is in 18 years just shy of 20%. Now to put that in relative terms in the car industry here in Australia we impose 5% tariff on cars, which of course will go, but this will still be an almost be 20% tariff on our beef. That’s fairly substantial, I would say David it’s one all now. It’s one for the National Party on GrainCorp and it’s one for the Liberal Party on this Japan free trade agreement. The National Party have certainly been the losers out of these arrangements.

SPEERS: Well, Parliament does get an opportunity to vote on ratifying this agreement. From what you know at the moment which way would you be leaning?

FITZGIBBON: Look you know the Party and obviously the Shadow Cabinet and caucus hasn’t had an opportunity to discuss that. But I would have thought that in the first instance and as a matter of principle, the opposition wouldn't be running interference on and arrangement struck by the government of the day.

SPEERS: Even though it’s not everything everyone wants but the point being that its better than nothing and the government has struck this so you would inclined to back it.

FITZGIBBON: You might recall I suspect in around 2003/04 with the US free trade agreement, the opposition of the day, the Labor Party, then sought some amendments to the agreement around the Pharmaceutical companies. So there are options for the Labor Party. I mean we haven’t even seen the agreement yet so it’s all pretty hard to make comment on.

SPEERS: Well there has also been concern raised by the union movement about submarines this could pave the way for Australia buying off the shelf submarines from Japan rather than building them locally here in Australia. Are you concerned about that and as a former Defence Minister how important do you think it is to build subs locally?

FITZGIBBON: Well of course I am concerned for two reasons. One, I didn't hear Tony Abbott telling South Australians prior to the election that he didn't have any intention of assembling the submarines in South Australia as was our plan. Two, I saw Stephen Loosley - and I appointed Stephen Loosley to the chair of ASPI, he is a friend, I hold him in high regard and he is entitled to his independence. But this idea that without a review of the strategic assessment, which we spent months doing in government, that you just decide one day to half the planned number of submarines is a bit extraordinary. Why not halve the JSF fleet instead, I don’t…

SPEERS: We need 12

FITZGIBBON: Well, not every government gets the strategic assessment and response right I wouldn’t argue that. But as Minister supported by the National Security Committee I spent a lot of months listening to advice from the experts about our strategic situation in the region and what  sort of response we might use and if you are going to change the number of submarines - I’m not expecting people to make it public - but you want to be able to demonstrate that you re-visited that strategic assessment not just arbitrarily decided that you only need 6 subs now rather than 12. And I saw Stephen Loosley say, you know,12 is too many! Well really? We all know about submarines- you need 12 to have four operational at any given time.

SPEERS: At the moment it is two or three at best.

FITZGIBBON: Sadly I think generally we have got one operational at the moment, that was the other suggestion; that you might extend the length of the Collins. It won't happen. You know I am told David this year for the first time in eons we will not be represented at RIMPAC in Hawaii -  that is the joint naval exercise -because we just don't have ships to send. The Navy needs rebuilding, we had a plan in place, they can argue about budget cuts if they like, but we had a plan in place. If they are going to change that plan they want to be able to demonstrate that they have had a close look at our strategic environment.

SPEERS: Final question on the Labor Party. Your NSW colleague, John Faulkner has today reaffirmed his view that you should open up the selection of senators and state upper house candidates to all party members not just the faction chiefs.

FITZGIBBON: Well I’m a great and well-known supporter of party reform. It got me into a bit of trouble with the unions back in about 2002, but I am a strong supporter. But the party also has to be ready for the challenges that will bring to the party. I mean the leadership ballot  showed that those coming to the party are of the progressive left and the party needs to ensure that it doesn't creep too far from the center because it needs to remain electable. I thought Nick Cater had a very good piece today about Joe Bullock. He has come into some criticism in recent days, but the Joe Bullocks of the world - the conservatives in the party and I might describe myself as a conservative in the party - do put some ballast in the party and do help to keep the party electable.

SPEERS: So you’d be worried letting the party members choose the senate ticket we end up with just left faction.

FITZGIBBON: No, I’m a believer in letting party members decide. I think you can never have too much democracy, we just need to be ready for where that might take us.

SPEERS: Joel Fitzgibbon good to talk to you thanks for joining us.

FITZGIBBON: It’s a pleasure.


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