Second Reading – Shipping Legislation Amendment Bill

Monday, 12 October 2015

Mr PITT (Hinkler) (12:20): It is always a great pleasure to follow the member for Fowler, a very generous supporter of my predecessor, Mr Neville. I thank him for his words of support. I rise to speak in support of the Shipping Legislation Amendment Bill 2015. The bill will help to make the Australian shipping industry more competitive and efficient. I note the comments of the member for Fowler on Mr Neville’s previous involvement in previous committees, but the reality is very straightforward. The legislation that was put forward by Labor, and enacted, simply has not worked. In fact, it has had the opposite effect, as we have had large decreases in Australian coastal shipping. I am a common sense person and a practical person. If things do not work you need to make changes. That is the harsh reality of the world.

This government is committed to ensuring Australia is open for business, so that we can grow our economy and create jobs. That is why we have signed free trade agreements with China, Japan, and South Korea. The Trans Pacific Partnership Agreement, the biggest global trade deal in 20 years, will improve Australian trade across the 12 countries that make up 40 per cent of the global economy. The full benefits of these agreements will be reached only if we have the networks and services to support trade. Global connectivity is key to creating opportunities. As an island nation, shipping is essential to Australia’s prosperity.

For too long, companies wanting to move goods or passengers by sea have had to deal with a complex and burdensome licensing systems. The reforms contained in this bill will help reduce the burden on business, open up new opportunities and unlock the potential of our coastal trading routes. Under the previous Labor government, the fleet of major Australian registered ships—over 2,000 tonnes dead weight—with coastal licences was in sharp decline. They have plummeted from 30 vessels in 2006-07 to just 15 in 2014. As I said, the proof is in the pudding when it comes to the reality of the changes that Labor made previously. There has been a sharp reduction in Australian vessels; we need to act and we need to make these changes. Between 2000 and 2012, while the volume of freight across Australia actually grew by 57 per cent, shipping’s share of the Australian freight task fell from about 27 per cent to just under 17 per cent. That is a massive reduction. Between 2010 and 2030, Australia’s overall freight task is expected to grow by 80 per cent, but coastal shipping is only forecast to increase by 15 per cent. It is the great ocean highway. It is an opportunity for us to reduce road and significant other areas of transport. Over the first two years of the former government’s coastal trading act, there was a 63 per cent decline in the carrying capacity of the major Australian coastal trading fleet.

As explained by the Deputy Prime Minister in his second reading speech, evidence shows that Labor’s legislation increased the price of coastal shipping services but failed to improve the quality and availability of those services. Bell Bay Aluminium reported a 63 per cent increase in shipping freight costs from Tasmania to Queensland in just the first year of the 2012 regime—from $18.20 a tonne in 2011 to $29.70 a tonne in 2012. As someone who comes from a business background, I can say that you cannot sustain those types of increases. A 63 per cent increase in freight costs in just one year is simply unsustainable and it costs Australian jobs. It is absolutely alarming that it is cheaper to ship sugar from Thailand to Australia than it is to ship Australian sugar around our own coastline. As someone who has been involved with the sugar industry since the age of five, I know that this is an absolutely diabolical outcome for Australian growers, Australian millers and all the people associated with sugar. Across the Queensland coast, there are major sugar storage facilities which rely on shipping.

In my electorate of Hinkler, in the city of Bundaberg, the sleeping giant for our economy is the Bundaberg port. There are enormous opportunities for us to grow and diversify our local economy. The Bundaberg port has real opportunity in the future. We have had announcements from companies such as Knauf, an international plasterboard manufacturing company, that it will build a $70 million manufacturing plant at the Bundaberg port, subject to a few conditions. One of those is the supply of gas. This is unusual, I am sure, but I congratulate the new Labor state government on recognising how important that infrastructure is and maintaining the previous state government’s commitment—because, without that gas pipeline, this project would not go ahead. It will create 200 to 300 jobs in construction and around 65 full-time positions and add some two per cent to the local GDP. That is an enormous addition to our local economy. The Bundaberg port has just started to export sand, which is a new opportunity for a local producer, and, of course, with the new gas line I am sure other businesses out there will be attracted to the port facility for opportunities for manufacturing.

But sugar is Queensland’s largest agricultural crop by volume and value. With 80 per cent of Australia’s sugar exported overseas, it is also Australia’s seventh largest agricultural export. Australia’s sugar exports were worth $1.4 billion in the financial year before last, making us the third largest supplier in the world. I congratulate Minister Robb on signing the TPP. Whilst our growers have not been glowing in their endorsement, they recognise that it is a significant improvement on our current access to the US market. I have spoken to my local growers, they are satisfied that we have done everything we could and I congratulate the minister on his work. This industry also employs 50,000 people, and nearly all of those are located in regional centres and regional areas—not just the farmers but the people who supply machinery and provide fertiliser and all of the add-on services. It is an incredibly large and important industry for the Queensland economy. Thousands of people in my electorate are reliant on the sugar industry to keep a roof over their heads and food on the table for their kids. It is an industry which has been around for over 100 years and, I hope, will continue strongly into the future.

When it comes to coastal shipping and this bill, we need to act now. Without change, shipping will not be able to deliver the internationally competitive and efficient services that Australian businesses and farmers desperately need. The main focus of the bill is a greatly simplified permit system that will reduce costs to business and enhance access to competitive international shipping services.

While we talk about those opportunities, I would also like to speak about the opportunity for a submarine maintenance base at the Bundaberg port. This is something which has been put forward for consideration by the Defence white paper, which I am sure will be released soon. I encourage the new defence minister to look at this opportunity. It certainly stacks up. It has been assessed by people who have considerable experience in defence. It is a location where it is actually cheap to live. There is lots of housing, there is plenty of available land and the local facilities are second to none. There is a real opportunity to put that base in Bundaberg.

We are simplifying the rules for moving cargo, simply because we must. Labor’s laws have failed—as I have explained in this speech today, they have simply failed. If we do not take action, there will be even less coastal shipping for Australian flagged ships. Australia’s rigorous maritime safety and environmental laws will continue to apply to all ships operating in Australian waters. The bill also has built-in protections for Australian workers. This is a brief contribution, but thank you for the opportunity, Mr Speaker. I commend the bill to the House.

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