8 June 2016




EMMA ALBERICI: But on the issue of trade, there are diverging views among the parties. Labor released its trade policy today. The Coalition laid out its trade agenda earlier this month. Both major parties are promising to open up new markets and, with that, new jobs.

So tonight, a trade debate: Minister Steve Ciobo in our Sydney studio; Shadow Trade Minister and South Australian Senator Penny Wong joined us from Canberra.

Good evening, Steve Ciobo, Penny Wong. Thanks for being with us.

STEVE CIOBO: Good evening.


ALBERICI: It’s been a year now since Andrew Robb signed the Free Trade Deal with China. At the time, the then Trade Minister promised it would bring billions of dollars to the Australian economy and hundreds of thousands of jobs. Instead, what’s been revealed just this week, Steve Ciobo, is that China has seen the FTA with Australia as an opportunity to bring here cheap Chinese labour at the expense of Australian workers?

CIOBO: Well, that’s simply not correct, Emma. The simple fact is that the reports to which you are alluding actually pre-existed the China-Australia Free Trade Agreement.

In fact, the sub-400 visa class to which you are referring, and that the articles were focused on, was a visa class that was introduced by Chris Bowen and the Australian Labor Party; has nothing at all to do with the Australia-China Free Trade Agreement.

But if you want to talk about the benefits that flow to Australia from the Australia-China Free Trade Agreement, there are many. I mean, bear in mind this is an agreement that the Coalition put in place, together with the other agreements we’ve got with Japan and Korea, which are having significant positive economic benefits for Australia and in many respects played out in the first numbers that we saw in terms of GDP this year, which sees Australia’s growth rate now among the highest in the world for developed countries.

ALBERICI: Penny Wong?

WONG: Look, Labor supports high-quality trade agreements because we understand that more exports means more Australian jobs.

We did raise concerns with the Government’s decision to include labour movement provisions to the extent they did in the China Free Trade Agreement. You might recall Andrew Robb and I negotiated a set of additional safeguards in relation to the China Free Trade Agreement.

Regrettably, on the basis of some of the reports, it appears that some people are not observing the appropriate minimum wages, the appropriate conditions. And really, the Government does have to ensure that these conditions are enforced, that Australian laws are enforced when it comes to workers who come in under whatever arrangements, but particularly under the Free Trade agreement.

ALBERICI: Well, specifically on the reports that I was referring to – the ones that were reported in Fairfax Media – the temporary work visas reportedly granted to 10 Chinese men on this particular work site were reportedly welders. These visas were only supposed to be issued to foreigners who can demonstrate they have skills that can’t reasonably be found in the Australian market.

It does seem to vindicate the concerns the union movement had, that this was exactly what was going to happen as a result of this allowing companies to come in here and bring their own workers?

CIOBO: Not at all, Emma. These are Labor Party visas, introduced by Chris Bowen and the Labor Party, which have now been used. And look, I agree with Penny on this-

ALBERICI: -Let’s let Penny have a response to that.

WONG: Look, I don’t Steve’s right. But one thing is undeniable: Steve and the Abbott-Turnbull Government loosened the arrangements for people movement under the chapter the of Free Trade Agreement.

CIOBO: That’s not true. That’s completely false, Penny.

WONG: Look, let me finish. Let me finish, Steve.

CIOBO: That’s is not true.

WONG: That is true. You loosened the arrangements for people movement under the China Free Trade Agreement, because you removed labour market testing: that is, demonstrating that these jobs could not be undertaken by an Australian; and you extended the arrangements to tradespeople.

Now, we said that was the wrong call. That is not what we would have done in government. I think it is undeniable that you did that. Now, that creates a set of additional compliance issues. Whether or not these particular visas: which class they came under, I think, is not really the point.

The point is there is clearly a compliance problem. We should ensure that Australian wages and conditions, Australian occupational health and safety arrangements are enforced and workers are not exploited. Overseas workers ought not be exploited in the way it appears these workers were, in the way it appears 7-Eleven workers were.

We have is a system in this country that needs to be observed. And I think if compliance is not occurring, the Government needs to look to it more.

ALBERICI: Are you investigating this?

CIOBO: Of course.

ALBERICI: Chinese workers being paid $10 an hour, or thereabouts?

CIOBO: Emma, no one supports people being exploited. And we of course have a strong labour force system in Australia. My point is this-

ALBERICI: -But you are investigating this particular case?

CIOBO: Absolutely. This is being looked at. This absolutely is being looked at.

ALBERICI: But there is always anxiety with these free trade agreements among Australians: that perhaps the other country is getting a better deal than we got out of it. And I mean, it’s undeniable that 200,000 – or thereabouts – manufacturing jobs have disappeared in Australia since 2008. We now report the smallest share of manufacturing in total employment figures of any OECD country. So if not manufacturing and no longer mining: where, Steve Ciobo, are the jobs and growth your Government talk about going to come from?

CIOBO: Well, the good news is that job creation under the Coalition has been at three times the rate it was under the Labor Party. And what’s more: what we’re seeing is – and the Turnbull Government has put a deliberate focus on this – are on services exports. Seventy-five per cent of the Australian economy is built around services. We have seen substantial growth in services. And what’s more, Emma – in services exports-

ALBERICI: -So it doesn’t bother your Government to see manufacturing-

CIOBO: -Oh, well, don’t verbal. Don’t verbal what I’m saying.

ALBERICI: No, I’m asking you: it doesn’t bother your Government to see manufacturing jobs disappear in Australia?

CIOBO: Of course we would like to see all sectors of the Australian economy doing strongly. And in fact, Emma, if you look at the most recent export numbers, manufacturing exports were up by more than four per cent. So we actually are getting growth in manufacturing exports. We’re getting growth in services exports. We’re getting growth in relation to education and tourism; in a whole array of different areas as a direct consequence of the agreements that the Coalition has put in place, which is driving unemployment down and driving the rate of job creation under the Coalition to being three times the rate it was under the Labor Party.

ALBERICI: Penny Wong, both Donald Trump and Hillary Clinton have now publicly rejected the Trans-Pacific Partnership deal. Where does that leave Australia, do you think? Can it be renegotiated without the US?

WONG: I did want to actually respond to a couple of things Steve said, if I can, before I come back to that trade point.

I would make this point: We actually are seeing lower living standards now. We are seeing Australians haven’t had a rise in living standards since December 2013. We’ve seen 50,000 jobs lost since December of last year. Now, they are not great figures. I do agree that there are opportunities in exports. I don’t agree that the Government is focusing sufficiently on manufacturing, particularly advanced manufacturing, because I think – and I say this as a South Australian – that is an important part of any advanced economy.

Yes, services is very important. And I agree with Steve: we need to do more to improve services exports. But we can’t let advanced manufacturing fall by the wayside. And unfortunately, this Government has.

On Donald Trump and Hillary Clinton: I think the point here is the Trans-Pacific Partnership, there are many views about it. We can have a long discussion. But if the US Congress doesn’t ratify it, then the agreement doesn’t get off the ground, that’s the reality.

ALBERICI: It is appears it’s dead, buried and cremated, the TPP?

CIOBO: The most likely scenario is that, if it is to take place, it’ll be in what’s called the “lame duck session”: after the new President is elected but prior to their inauguration. So look, I don’t know. I’m not an expert on congressional politics. Time will tell. But I do know that the Obama administration-

ALBERICI: -But without the US it’s over, isn’t it?

CIOBO: Absolutely it is. Look, without the US it can’t fly.

ALBERICI: Steve Ciobo, independent Senator Nick Xenophon is campaigning strongly against your Government’s free trade agreements. He asks, if the FTAs are such a brilliant success, why are we running a growing current account deficit? Why are our manufacturing imports outstripping our exports? And why is our foreign debt piling up at such a rate?

CIOBO: What we want to do is make sure we focus on export opportunities. The most recent export numbers show big growth in exports, both in services, in agriculture and, as I said, in tourism and education as well. So the fact is our free trade agreements are actually working to Australia’s national interests.

ALBERICI: Penny Wong, the former Prime minister, John Howard, campaigning in your home state of SA today, drew a parallel between independent Senator Nick Xenophon and Pauline Hanson, saying both are trying to exploit fears when it comes to trading with Asian nations. Do you agree there is a valid comparison to be made there?

WONG: Well, I mean, I think they’re very different sorts of characters. But I do think that Nick, he gets a lot of attention and he certainly focuses on people’s fears and concerns; and legitimate concerns about the changes in our economy. Where I don’t agree with him is on his prescription: because what he is saying to people is, oh, we can fix it all by pulling up the shutters, by not engaging with the world.

I think the reality is we are a nation that needs to trade into the growing markets of Asia if we want Australian jobs to continue to grow; if we want Australian living standards continue to grow. So the question is not whether we should do that, but  how is it that we best invest in our people, in our infrastructure, in our economy, to ensure we get the best out of those opportunities; we leverage these opportunities the most and we help Australians through that transition?

Now, that’s why we have announced investment in infrastructure today. Bill announced investments to ensure more apprentices. We do have to work with the community through this transition. But I don’t agree with Nick that we can just simply say we are not going to engage with the world. We are on the doorstep of what will become the largest economies in the world, what will become what is a growing part of the global economy with the largest group of consumers, middle-class consumers globally.

We have an opportunity to trade into the region. We’ve got get the most out of it. We’ve got to get more Australians connected to those opportunities, that’s the challenge.

ALBERICI: Steve Ciobo, is Nick Xenophon: do you see a valid comparison between Nick Xenophon and Pauline Hanson, as former Prime Minister John Howard does?

CIOBO: Oh, look, I mean, I understand his concern about xenophobia. And frankly, this goes to the point I was making earlier: I mean, the Labor Party does this, unfortunately, as well. We’ve seen it

WONG: Oh, here we go again. Here we go again.

CIOBO: Well, Penny, you’re – we’ll, that’s because it is – you know, it’s a simple, important matter. We see with the CFMEU-

WONG: -No, Steven, at some point you could answer a question about you. How about answering a question about your view, as opposed to just talking about us?

CIOBO: Well, now what I’m saying – and I want to be very clear about this – is, we see examples of that same xenophobia coming from elements of the Australian Labor Party.

WONG: Here we go again.

CIOBO: No, Penny can keep talking over the top of me. That’s fine. We see-

ALBERICI: -Are you saying Nick Xenophon is xenophobic?

CIOBO: We see examples of-

ALBERICI: -Sorry, can I just clarify what you’re saying?-

CIOBO: -examples of xenophobia. Absolutely. Examples of xenophobia and we see it with the CFMEU which is, you know, Penny’s mothership in terms of the union she’s come from.

WONG: Oh, please. Seriously.

CIOBO: And so my question to Penny is this, Emma: will Penny as Shadow Trade Minister guarantee we won’t see the kind of disgusting campaign that we saw from the CFMEU last time in relation to the China-Australia Free Trade Agreement?

ALBERICI: With respect, Steve Ciobo, I ask the questions here.

CIOBO: Sure, but I think it’s a valid point, because I would like to know-

ALBERICI: -And I want to draw you back to my point which is, of course…

CIOBO: Penny wants to be the Trade Minister. I’d like to see her view on this.

ALBERICI: In the latest Newspoll, we see that one in five South Australians want to vote for Nick Xenophon. He’s a very significant force in one of the states in this campaign.

CIOBO: Sure.

ALBERICI: He is making the future of the Arrium steelworks an election issue in Whyalla.


ALBERICI: If that particular company folds, that’s worth $1 billion to the Australian economy and something like 5,000 jobs. Can the Government step in and save it?

CIOBO: Well, look, we are certainly doing all that we can. I mean, clearly one of the most important measures that the Coalition has undertaken with respect to Arrium is to bring forward the upgrade of the rail track. We’ve done that from Adelaide. We’ve also, of course, put in place a very proactive multi-year purchasing policy in relation to the construction of submarines, Offshore Patrol Vessels.

These are all things that Labor did absolutely nothing on when they were in government for six years. So this provides a very good chance for Arrium.

ALBERICI: Just before we go, I want to ask you about something that’s just come through this evening from the corporate watchdog, ASIC. Penny Wong, in light of the fact that Labor has been calling for a Royal Commission into the banks, ASIC has just launched proceedings against the National Australia Bank, related to a period between 2010 and 2012; and saying that they were manipulating the bank bill rate. Do you think this gives vindication to your calls for investigation of the banks?
WONG: I think obviously, enforcement action is a matter of ASIC. And if they think that’s appropriate, then that’s the appropriate thing to do. But I think the reason we called for a Royal Commission on the banks and indicated, were we to win government, that we would implement one, is that I think Australians have seen over particularly this last year a range of actions reported, activities reported, concerns reported that really do raise doubts about some of the behaviours and cultures inside the banks.

Now, we want a strong financial system. And I think these issues do merit consideration, which is why we made the announcement well prior to the election that we would undertake a royal commission into the banks.

ALBERICI: Steve Ciobo?

CIOBO: Well, if anything, I think this just reinforces the view that we’ve had, which is that ASIC has at its disposal a full suite of powers that extend far beyond what a royal commission could do. And the fact that ASIC has obviously taken this decision to launch action against the bank just reinforces our view, which is that there is already these powers available: and they will be utilised.

ALBERICI: Presumably, though, a bank with all its might will fight back very strongly?

CIOBO: I have no doubt, but you know, that’s the system.

ALBERICI: We’ll have to leave it there. Steve Ciobo, Penny Wong, thank you very much.

CIOBO: Thank you.

WONG: Thank you.