SUBJECTS: Queensland sugar dispute; sugar industry code of conduct; Minimum Wage case; Malcolm Turnbull’s $50 billion big business handout.


CHRIS BOWEN, SHADOW TREASURER: Thanks for coming ladies and gentleman.

Last night rather late in the evening the Treasurer and Deputy Prime Minister held an extraordinary press conference where they announced a new code of conduct for sugar marketing in Australia. Now codes of conduct have their place in the Australian regulatory system. Governments of both persuasions have announced them and implemented them, but they are important documents that are worked through carefully. There is proper consultation, drafts and feedback. What we saw last night was nothing more and nothing less than policy on the run and the outsourcing of economic policy in Australia by Scott Morrison to Pauline Hanson in a desperate attempt to get Pauline Hanson’s votes today in the Senate.

Why would a Treasurer and Deputy Prime Minister of the country call an urgent press conference when many journalists had gone home, many journalists were at different functions, many journalists were not in a position to cover the story? One, because they wanted to hide it, because they are not proud of it and two, because they were desperately scrambling and making it up as they were going along.

Just on Monday the Treasurer was asked about the need for government intervention and he declared victory and he said there was already an agreement that had been reached and there was no need for this sort of action and claimed credit for that agreement. This Treasurer can’t hold a policy from Monday to Wednesday, let alone from one Budget to another.

We haven’t seen the draft code of conduct. My colleague Joel Fitzgibbon will talk more about some of the details. We’ll look carefully at it. The Treasurer last night claimed it contained mandatory arbitration. That would be almost unprecedented in Australia. In the next paragraph he claimed it was light touch which indicated he’s clearly not across the detail because you can’t have mandatory arbitration and it be light touch. It’s one or the other. Either he’s not across the detail or he doesn’t understand the policy he has signed off on. It’s Scott Morrison and Barnaby Joyce outsourcing economic policy to Pauline Hanson which is a very dangerous development. Scott Morrison has already outsourced so much to Barnaby Joyce. The effects test for example, the most anti-business, anti-innovation, anti-competition piece of policy to be put before this Parliament by Malcolm Turnbull and Scott Morrison at the assistance of Barnaby Joyce. As Joel Fitzgibbon has pointed out, this effects test is claimed by them to solve many problems, but what they are now doing is saying the effects test is not enough and they need a mandatory code of conduct. This is a Government all at sea with economic policy, making it up as they go along, unable to keep a single consistent policy from one day to another.

Normally when a government announces a code of conduct it would have followed careful consideration and consultation and they would have released a draft. We have not yet even seen this so called code of conduct so we will take our time, unlike the Government to carefully and appropriately consider its implications.

What they have done is potentially sent a shock to the Queensland sugar industry and the negotiations that were already well advanced. Sent a shock that will be difficult for these very important companies and players to recover from in terms of their negotiations. So Scott Morrison in particular as well as Barnaby Joyce need to reflect very carefully on their actions. We don’t expect much more from Barnaby Joyce, we know he is reckless when it comes to economic policy but the Treasurer of Australia is looked to as the guardian of good policy. Scott Morrison has shown once again he is simply not up to the job. Over to Joel.

JOEL FITZGIBBON, SHADOW MINISTER FOR AGRICULTURE: Thanks Chris - and Chris has touched on it, the big question here is, what happened between Monday when Scott Morrison was claiming credit for resolving the dispute in Queensland and last night when suddenly it seems we need a code of conduct without any consultation and without any proper development. My concern here is for the growers and the thousands who work in the sugar mills in Queensland and elsewhere. We are approaching June, the crushing month and time is now of the essence. We need the Queensland dispute resolved and we needed it resolved a month ago. Scott Morrison said on Monday, wrongly claiming credit, but said on Monday the primary agreements had been reached and we only had to go through the fine detail. By entering the debate now with the threat of a mandatory code of conduct with obligatory arbitration can only threaten to scuttle those final negotiations at the eleventh hour. This is the real issue here. This is sending all the wrong messages to not only our growers but also to the companies involved. If you are still struggling in those negotiations and you are still not sure you’re getting the deal you’re looking for, you will be emboldened by promises from Canberra that there will be further intervention. This does not help. It doesn’t help in settling a resolution and it certainly doesn’t help the growers.

Now the Labor Party, just to reinforce what Chris said, we are not against codes of conduct, we support codes of conduct that are properly constructed and done in consultation over a period of time. We expressed support for a code of conduct in the sugar industry during the Senate Inquiry back in 2015. Why suddenly after all this time on a Wednesday evening in Canberra do we immediately need a code of conduct? Why didn’t Barnaby Joyce do something about a code of conduct all that time ago? And by the way, there are a number of sectors in Australia who support the implementation of a code of conduct including the dairy sector. The dairy sector has gone through some very difficult times in recent months and years as you know. They have been asking for a code of conduct for at least the last three years. Barnaby Joyce has done nothing about a code of conduct in the dairy sector. But suddenly we need one immediately in the sugar industry. Well it’s just so obvious and transparent. This is about the vote in the Senate today around company tax cuts and it’s about a wounded Barnaby Joyce scrambling to protect him and his party including George Christensen from the scourge of One Nation. They know they are in enormous trouble in Queensland, they are going to attempt to save themselves at the expense of millers and growers and those who invest in the sector.

Remember, this code of conduct is not just about Wilmar, this code of conduct is about the whole milling industry - not just in Queensland but nationally. This will send a chilling message through investors everywhere. Australia at the end of the day is a relatively small market. Companies like Wilmar and others including the company based in Thailand, MSF I think it is, could just decide that it is all just too hard in Australia and investing in mills in Australia is just not worth the pain. Imagine the impact on Queensland growers if the investors just decide to go home. There is a prospect this code of conduct, if not properly constructed, and we are prepared to have that dialogue, will offend our free trade agreement with Singapore. I know for a fact this is very much exercised in the minds of not only Wilmar but the Government of Singapore. So again it’s all the wrong messages to investors in sugar, but across the economy as Chris and I discussed earlier, all the wrong messages to investors right around the globe. They are looking at Australia now and they are seeing lower screening thresholds for (inaudible) they are seeing an anti-competitive effects test and now they seeing Governments overnight without consultation, without proper development threatening to introduce a code of conduct, a mandatory code of conduct with compulsory arbitration, unheard of, dangerous, reckless, damaging to our economies and potentially fateful for our growers in Queensland.

JOURNALIST: Do you find it ironic that two Labor Shadow Ministers are arguing an anti-protectionist free trade (inaudible).

BOWEN: It’s more and more the way Phil. Here we are standing up for good policy opposing the effects test. Here we are saying while a code of conduct can play a role, it’s got to be done carefully. In many senses, when we see this full code of conduct it could well be possible to conclude that what Scott Morrison and Barnaby Joyce are trying to do is take national the re-regulation of the sugar industry the Liberals the Nationals and Katter Party have imposed in Queensland against the will of the Queensland State Labor Government which has been criticised by experts around the country. More and more you see Scott Morrison being completely bereft of his own economic set of beliefs and outsourcing economic policy to whether it be Barnaby Joyce or Pauline Hanson for a desperate and craven attempted to win Pauline Hanson’s votes in the Senate and to help the like of George Christensen in their seats. That is not how you write good economic policy. We will consistently argue for good policy. We will argue it vigorously. We will argue it strongly. And I believe we will win those debates.

JOURNALIST: Are you prepared, Mr Fitzgibbon, to raise a disallowance motion on this sugar industry code of conduct?

FITZGIBBON: We will have no choice but to closely study the so called ‘code of conduct’ which I’ve been asking Barnaby Joyce to pull out of his drawer all week now. Now I would have thought that if they wanted to make a concrete promise to Pauline Hanson last night which was the obvious purpose of the late night press conference, they could have also produced the code of conduct. This indicates to me that the code of conduct is not yet even written. Not yet even written. Last night was about, there’s no doubt Pauline Hanson would have said, I need you to go out publicly and make the promise. And that’s what they did. But if the code of conduct is not even yet fully drafted, how can the Labor Party possibly be expected to have a view on it? Again, we support in principle, codes of conduct. They’ve operated under the Trade Practices Act for some time. Since the early 2000s. But we can’t be expected to commit to one before it’s even developed, let alone see it. And of course I know for a fact, I’ve checked with the companies, Wilmar nor any other company operating in this country has been consulted on this matter. Indeed they are ringing me this morning out of desperation, asking ‘have you seen the code of conduct’ and of course the answer is no.

BOWEN: Yes and Joel is 100 per cent right. And just to add one point, to be clear, the Government has offered us a briefing this morning, which we will accept. But there should have been much more consultation, much more transparency to the development in this process. You shouldn’t need post fact briefings. We should know what’s in the code of conduct because it’s properly been consulted on in the first place. And that’s where the Government has gone wrong. You know I dealt with codes of conduct in my capacity as Assistant Treasurer, and in varying other capacities. There’s a way to do it. And Scott Morrison is showing the way not to do it.

FITZGIBBON: And I also make the point that we are very concerned if there’s a mandatory arbitration provision, in a mandatory code, and I would suggest that, and I’ve had a bit to do with codes of conduct too, that it is reckless to use executive order to do a code of conduct by regulation, if it has such far reaching provisions as mandatory arbitration. It sends all the wrong signals to other sectors as well. If you did it by legislation, then of course you’d have it properly debated in the House, in the Senate, probably a Parliamentary Committee to test what are the adverse implications and consequences of that compulsory arbitration. Doing this by regulation is not the norm. Is not the right thing to do. And we will of course be asking questions about that as well. But Scott Morrison said two things which completely contradict themselves. He said this will be light touch, this code of conduct, because he wants to send a message that he’s the Treasurer who is a free marketeer, who understands economic policy but at the same time he’s got Barnaby Joyce and Pauline Hanson on this side expecting him to go harder. So he says it’s light touch but it’s going to have compulsory arbitration. Well it’s one or the other. It can’t be both.

JOURNALIST: Are you expecting Wilmar to withdraw from Australia, do you think, over this?

FITZGIBBON: The gist of the discussions with Wilmar, we have been in contact with Wilmar, of course they made no such threats. Wilmar and other milling companies in Australia are very restless and very concerned at this point in time, as you’d expect them to be. But I know they have a very strong commitment to Australia. They have a very strong commitment to their workforce, and I have no doubt that they will continue to do their very best to work with the Government through this process, but the Government is making it so hard.

JOURNALIST: Have you had any indications from the Singaporean Government that they are worried that this could breach the FTA? Have they made those concerns to the Labor Party?

FITZGIBBON: I’ve certainly had conversations with their representative here in Australia. We’ve deliberately not gone into detail. Suffice to say, on behalf of his Government he has expressed concern about what’s playing out here in the sugar industry.

BOWEN: And that’s the problem when you have policy on the run. I mean you know, this should have been subject to proper cabinet consideration; the Trade Minister, the Foreign Affairs Minister, having the chance to review these things and to see whether it meets our international obligations. When you know, Scott Morrison and Barnaby Joyce write it on the back of the coaster and hop out at seventy-thirty at night and announce it, that’s when you see errors and potential problems with our international obligations emerge.

JOURNALIST: Mr Bowen, on minimum wage submissions..

FITZGIBBON: Before you go to minimum wage, can I say what we do know, is privately and semi-publicly, both Andrew Robb before he left this place, and in particular Julie Bishop expressed very strong concerns about the Government getting involved in the sugar industry and in this dispute.

JOURNALIST: On the minimum wage submissions, the Government’s submission says that many low paid workers often come from high income households. What do you make of that?

BOWEN: How much more evidence do you need that this Government just doesn’t get it? I mean Malcolm Turnbull and his Government think that people working in low income environments, working hard on weekends and in shift work are usually from a high income household. I mean these guys just don’t get it. And it makes our blood boil on behalf of low income Australians, working Australians. I mean we need a safety net in Australia and that safety net partly comes from the social welfare system but it partly comes from the minimum wage. And we don't want to be a low wage economy. We don't want to go down the American road and a minimum wage, a good strong minimum wage is an important protection and it’s important for our economy and these guys just don't get it. We have wages growth at record lows and what is this Government’s answer? To support a wage cut, the biggest wage cut since the Great Depression. That's their answer to low wage growth in Australia. It is an utter disgrace.

JOURNALIST: Chris, you suggested this code of conduct is made to stitch up a deal on the company tax cuts. Obviously Labor have been hard and fast to the $2 million threshold. What are your fears if some of those crossbenchers give in to say a $10 or even a $50 million dollar threshold and what would your advice to some of them be?

BOWEN: Well, my advice to every Senator is to remain consistent. The Labor Party is the only Party that has been consistent from the last budget when this policy was announced. Scott Morrison in the last week of Parliament couldn't say whether the centrepiece of his 2016 budget would even be mentioned in the 2017 budget. We've been consistent.

Now Pauline Hanson has said she is against the corporate tax cuts on Insiders, Nick Xenophon has said he will only vote for a corporate tax cut in return for an emissions intensity scheme. I mean I'm not going to predict what happens in the Senate. I learnt a long time ago that that was a fool’s game. I'm not going to predict it, I’m not going to get involved in that speculation. I've been here long enough to suspect that Joel and I might not be getting much sleep this evening. We might be here fairly late waiting for the Senate to respond and I'm not going to comment on every thought bubble or speculation that comes out of the Senate. I'm going to remind you that the Labor Party has been consistent and will continue to be consistent.

JOURNALIST: Is the ACTU’s claim for a $45 increase to the minimum wage, the Government says that could crimp job prospects it's that high but they won't put a number on how much it should increase by and neither will Labor.

BOWEN: Well the ACTU has a very important role and the Labor Party has consistently in our capacity in Government and now in Opposition put in submissions calling for a responsible increase in the minimum wage. Now the ACTU has a different role to play. They put a dollar figure on it that is a matter for them to argue to the Commission and to make their case. But we are very clearly, the ACTU and us have got one mind that an important and strong minimum wage including an increase is appropriate. The ACTU has quite rightly put a figure on it and argues for it, the Labor Party has always taken the approach that we would talk about the principles underpinning the need for a minimum wage increase.

JOURNALIST: Mr Fitzgibbon and Mr Bowen, just on the Productivity Commission’s report into Agricultural red tape, 700 pages of pure joy if you've got the time. The Government is saying that they are going to possibly not respond in full that individual ministers would respond. What's your view on that?

BOWEN: No surprise there. They're not going to respond in full because they don't like it. Because the Productivity Commission has called them out on an effects test, on the Foreign investment thresholds and on sugar re-regulation so of course they're not going to respond in full because the Productivity Commission has pointed out the economically reckless approach of this Government in Agriculture. Joel will elaborate.

FITZGIBBON: Absolutely right, I have laboured through most, not most a large part of the document which they have been sitting on since November. Now this was one of the few good things that came out of the agricultural white paper: the decision to send to the Productivity Commission an inquiry into the regulatory burden in the farm sector. Why have they sat on it since November? Because they've got all the wrong answers from their perspective and of course as Chris said it has been highly critical of some of their key policies areas: effects test, FIRB thresholds and more specifically it made specific extensive mention of Queensland sugar and it basically made an appeal to this Government to stay out of it.

JOURNALIST: And what about the Independent Office of Animal Welfare because they are already signalling that they won't be going down that path. What's your view?

FITZGIBBON: I was very pleased that the rather economically dry Productivity Commission agrees with us that the best way to produce sustainability and to maintain alliance for the sector in Australia is to make sure that people can see an independent arm's-length regulator watching over the industry. That's what we promised at the last election. I have no doubt we will be promising that at the next election and I'm glad that the Productivity Commission has given our policy a tick

BOWEN: Will have to wrap it up there folks.


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