I rise to support the amendment moved by the shadow minister for trade, the member for Curtin, to the Export Market Development Grants Amendment Bill 2013.
It has long been said that Australia is an exporting nation, and this has never been more obvious than in Western Australia. According to state government figures, Western Australia contributed $122 billion of Australia’s merchandise exports in 2011-12, a rise of five per cent on the previous year.
This equates to 46 per cent of this nation’s exports, which exceeds the combined contribution of New South Wales, Victoria and Queensland.
So it is a significant export effort. Trade accounts for 53 per cent of Western Australian’s gross state product, with the great majority, over 90 per cent, coming from the mining sector.
However, the state is also a major agricultural exporter. In 2010-11, Western Australia produced over $6 billion of agricultural, fisheries and forestry merchandise, and, of this, $5 billion worth was exported.
The vast majority of these products are going to Asia, due to Western Australia’s natural geographical competitive advantage—its proximity to those Asian markets. With these key figures in mind, it must be obvious even to the most parochial eastern state members in this House that Western Australia is in fact an export powerhouse.
It is for this reason also that export assistance needs to have a Western Australian focus and create further opportunities.
It is easy to be fooled into thinking that the west has only large multinational mining companies which are readily able to do their own marketing. Indeed, it might seem that our mining companies actually sell themselves—I know that some on the other side think this.
There are, however, many smaller players, in a range of industries, that certainly deserve the support of the government.
The south-west of Western Australia, in particular, is an area of innovation and industry.
Whilst we have a number of those same large exporters, such as Worsley Alumina, we also have a broad range and a large number of small suppliers exporting a wide variety of products.
As I know well, the south-west, with a $16.8 billion regional economy of its own, is an economic engine room for the whole nation.
The region derives most of its wealth from the mining and manufacturing sectors, which, latest figures show, produce $1.6 billion and $2.7 billion respectively.
It is also a major exporter of agricultural products, as I said, from beef and dairy—some of the best dairy products in the world—to the finest of Margaret River and Geographe region wines. Some of these have found niche markets for their high-quality products, and it is this group that needs and deserves support.
They are out there doing the hard yards. They are small businesses, frequently.
I note that the explanatory memorandum to this bill tells us in the outline that the bill ‘helps achieve savings of $25 million per year’. However, the explanatory memorandum also notes, under ‘Financial Impact’:
Expenditure under the Act is set through annual Appropriation acts. A capping mechanism ensures that expenditure under the scheme is limited to the amount appropriated.
They are conflicting statements. That really tells us, the readers, that the government has once again engaged in what you could only call a surreptitious slashing of funds—and this time it is actually of industry support to those same small businesses that are seeking an export opportunity.
As was acknowledged at Senate estimates, this is another attempt by the Gillard government to hide the real budget position it will face in May.
It is duplicitous of the government to attempt to hide this slashing of funding and to sanitise the explanatory memorandum.
This bill is not about enhancing exports. It is not. It is about saving the government dollars at the expense of those same very innovative and keen Australian exporters that just need a bit of a hand along the way.
This is at a time when the world remains almost on the edge of an economic precipice and when the value of the Australian dollar is crucifying Australian exporters. It is tough out there, and I do not know what the Australian government expects. If you are an exporter, it is a tough market. If you are an agricultural exporter, it is an even tougher market.
I saw some recent forecasts about the future of agriculture and agricultural exports, and they predicted even tougher times than we have now. I am concerned, as you would be, Mr Deputy Speaker Scott, for the future of a lot of those exporters and the growers that supply them.
I also noticed last week the economic forecasting by the Australian Bureau of Agricultural and Resource Economics and Sciences that indicated the Australian dollar is expected to stay at current levels—a particularly high level of at least US104c—and not return to parity until 2018.
If that is not a great example of the pressure that Australian agricultural exporters are under, I do not know what is. Everyone in this House needs to think again, including the government, because, if this scenario proves to be accurate, the export sector in Australia is in for very rough times until 2018.
The ability of both Europe and the US to survive their respective impending debt disasters will also have long-term impacts on the value of the exchange rate.
Now, there are optimistic economists demonstrating perhaps a bit of hubris at the moderate improvement in budget deficits in both of those areas, but the realist economists still recognise that those budgets are not actually in surplus but just a little bit less in deficit.
This is the reality, and that tells us that the Australian dollar is not likely to weaken anytime soon. It is also a reality that this global generation generally continues to almost binge on debt.
Those on the other side do the same thing. We heard today, in the debate on the MPI, about the government’s $300 billion debt—the debt ceiling. Let us wait and see what is in the next budget. Government spending is increasing the burden on the next generation—spending today is taxing tomorrow. This government is leaving debt and deficit for the next generation.
The next generation in Europe and the US will have to pay off the debts of their parents or simply pass them on with their own added debt to some future generation to take care of. In this parliament there has also been a passing on of intergenerational debt, perhaps for the first time in this nation’s history.
That is an indictment of this government.
Australian exporters may recover if the US dollar improves, but there is another element of the export debate that needs to be addressed here in the House today.
It is the failure of the government, through Austrade, to adequately enhance the export capacity and opportunity of Australian manufacturers and producers. It should be core business for Austrade to help our small businesses into the markets.
Austrade has a number of workers both domestically and overseas who are struggling with poor resourcing—and poor leadership, in some senses. The bill before the House does not improve this situation; it makes it worse.
Another $25 million cut from services currently provided is part of the government’s death by 1,000 cuts of export innovation, and it is death particularly to small exporters. I—like, I would bet, just about every member in this House—have had such exporters at my door saying: ‘All we need is a hand.
We need to get into these markets, but we are a relatively small business and we are doing it tough on the ground.’ I think it entirely escapes this government how tough it is on the ground, particularly for food manufacturers and exporters and even more particularly for those in the agricultural sector.
Austrade appears to be too bogged down covering for the government’s incompetence to do its own job properly.
It might surprise the Prime Minister and the trade minister to learn that the role of Austrade is to promote Australian exports, not to promote the Prime Minister and the minister for trade. Austrade needs to promote small to medium enterprises—and even some of the bigger enterprises—not only in my electorate but also around Australia.
Such businesses are investing their own money and their own expertise, and they are working overtime not just for themselves but also for their communities, for the regions and for our economy. They are alive and well in our part of the world but are doing it exceptionally tough, and often all they need is a small hand up.
A refocusing of Austrade is really urgent and essential so that our own exporters, rather than this government, can become the main agenda again. Austrade should be focused on our small to medium exporters who are out there wanting to get into the markets and provide some fabulous niche products.
This refocusing is so urgent and essential because of the difficult economic times in which Austrade is operating. Austrade’s job has got far harder since 2008. Things are also harder for our exporters, and we should all acknowledge how much harder they have got.
The difficult economic times make it all the more important for our businesses to work smarter and to invest more wisely, and to do so some of them need assistance. Now is not the time to hang our exporters out to dry.
Look at the terms of trade, look at what is happening on the ground, look how hard exporters are working and look how hard it is now that we do not have the numbers of tourists that we used to have coming to our part of the world. That is why it is important for Australian businesses to have access to export markets.
But the government is hanging exporters out to dry. It will probably take the election of a coalition government to end the rot and develop a focus on exports to assist small to medium enterprises and some of the bigger businesses.
A coalition government will seek to look after the interests of exporters and innovators. We need to celebrate and support what they are doing, not celebrate and support the failing government we have here.
The coalition will work for enhanced access for Australian businesses to world markets. We in the coalition understand very directly the importance of doing this work. If we are elected, we will do this work in conjunction with the private sector, and the private sector will also focus, I have no doubt, on marketing and market access.
In some sectors, both sides of the public-private partnership have abandoned the field. Both need to re-engage, and we in this place need to be part of the re-engagement.
Nowhere will re-engagement be more important than in the agricultural sector. When you get out into the wheat belt in Western Australia, you see how tough farmers are doing it.
There are the same challenges in my electorate. Right across Australia I see the same challenges. Farmers are finding it extremely difficult to remain viable. It is a huge challenge, as is the challenge of keeping enough young farmers coming through who have the knowledge, expertise and passion to continue doing what our farmers do so well.
We need to know what the Asian market is looking for. We know that we can produce the best quality food products in the world—we are good at it—but we also need to make sure that we have the capacity to deliver what established and emerging Asian markets are looking for.
A coalition government would make sure that it sufficiently developed and supported access to these markets for Australian exporters.
This government has repeatedly failed farmers in Australia. This fact is as tangible as it could be. One of the main examples of the government’s failure would have to be its actions on the live export trade.
The impacts of the government’s actions are being felt all up and down the chain in each state—and certainly in my electorate in south-west Western Australia. The impacts of the government’s actions are major, even though the government chooses to ignore them.
If you want to talk about impacts on exports, just look at the live cattle export debacle.
It is just one example of how this government has failed farmers in Australia. It has also failed our food producers and food manufacturers.
Australian farmers are certainly capable of delivering the products that the market not only demands but also deserves. Now is not the time to abandon Australian farmers.