Trade (Safeguard Measures) Bill

I could not help but notice that this particular bill, the Trade (Safeguard Measures) Bill, was referred to the Foreign Affairs, Defence and Trade Committee on 11 March 2009. Little would the members of that committee, chaired by the first-class member of Parliament John Hayes, have appreciated that some 3 years later I would be in the House, promoting this bill. Now—

The ASSISTANT SPEAKER (Lindsay Tisch): Order! I am sorry, but the Minister must move that the bill be read a second time, so—

Oh yeah, well, I move that the bill be read a second time.

The ASSISTANT SPEAKER (Lindsay Tisch): OK. The protocol must be that when the Minister starts, he moves that it be read a second time. The Minister might like to start again. I will start the clock again, so we get it right.

Oh, that is very generous, Mr Assistant Speaker. I move, That the Trade (Safeguard Measures) Bill be now read a second time. The year 2009 was some time ago, but this is an important bill. The closing date for submissions was 14 April 2009, and we are now in March 2012. So the National Government has been waiting for me to arrive, via the people of Epsom, for all of these years to see this bill—“Can-do Banksy”—promoted in this Parliament tonight, because it is a critical piece of legislation, particularly for the productive tradable sector of the New Zealand economy. I want to thank John Hayes, the chairman of that select committee at the time, for the great stewardship of this bill.

In the commentary to the Trade (Safeguard Measures) Bill it says: “The Trade (Safeguard Measures) Bill seeks to repeal the Temporary Safeguard Authorities Act 1987”—and I was in Parliament in 1987 when that bill was passed through with much more urgency; it had been only 5 years in the making, not 4, so this bill is well overdue—“and to implement a new safeguard regime for New Zealand that is consistent with the World Trade Organisation’s rules and promotes efficient, transparent, and objective investigative and decision-making processes” for safeguards. In case people do not quite know what safeguards are, they are emergency measures applied at the New Zealand border: any duty and any other facilitation to make sure that a domestic industry exposed to competition from increased imports is well and truly looked after. This country does not mind competitive trading, but it does not like unfair trading, and in the context of this bill and in the context of the trade agreements that this country is entering into all over the place, it is important that this measure comes through Parliament.

What I was going to say about the bill is something rather significant, and it is this. It repeals the Temporary Safeguard Authorities Act. The bill proposes four major changes to New Zealand’s safeguards regime. They are quite technical, and they need to be narrated here tonight in Parliament for the record.

Firstly, safeguard investigations will be undertaken by the Ministry of Economic Development, rather than by appointed temporary safeguard authorities. I think that is important and that has helped streamline these measures. This will align the conduct of safeguard investigations with other trade remedy investigations that are carried out by that ministry—that is, the Ministry of Economic Development. It will also allow the expertise of the ministry to be fully utilised when carrying out safeguard investigations, to ensure the efficient use of resources.

Secondly, the time frame to complete an investigation will be extended from the present 30 working days to 75 working days, or 85 working days if provisional duties are requested at the border. The extension of the time frame also allows sufficient time to undertake a high-quality investigation to make sure that fairness is delivered. This will reduce the risk of any safeguard measure taken by New Zealand being overturned through the World Trade Organization dispute settlement process—and we have seen that work against sovereign States on many, many occasions, to the detriment of those countries.

Thirdly, the Minister of Commerce will be authorised to impose a provisional safeguard duty in order to provide protection to a domestic industry while an investigation is being completed. I think that mechanism is also very useful and serves as a deterrent to unfair traders—that at the border we have got aligned mechanisms in place for dealing with unfair competition at the border before the arrival, with money being put up front so that that is secured. The ability of the Minister to impose a provisional duty will also allow swift action to be taken where necessary, and will ensure that an industry is not disadvantaged by the extension of the time frame to complete a complex negotiation and investigation. So the Minister of Commerce will be authorised to impose a safeguard duty, to allow a quick and efficient means for taking safeguard action at the border.

Lastly, as a trading nation—this is important—the bill introduces guidelines for determining whether the imposition of a safeguard measure is in the public interest.

The bill also includes a number of technical matters aimed at improving the efficiency of applications and investigation processes, and ensuring conformity with World Trade Organization rules. As we go forward negotiating more free-trade agreements with other sovereign States, we need to have these absolutely aligned with World Trade Organization rules, so that there is no opportunity for going to the World Trade Organization and having one of these overturned.The ACT Party believes that the more we can liberate trade between our nation and the rest of the world, the more our exporters will flourish—and exports are the key to this country’s future, particularly farming exports. The World Trade Organization leads the way in promoting multilateral free trade and it is in our interest to ensure our legislation aligns with its rules, and this is what this bill does.

Following the first reading of the bill, the Foreign Affairs, Defence and Trade Committee has recommended a number of amendments. These amendments do not alter the original policy intention outlined in the philosophy statement on the front page of the bill; these amendments simply strengthen and clarify the bill. Overall, submitters were supportive of the bill and recommended that it proceed. If I remember rightly, there were five submitters. Why it has taken 4 years to come through this House and why you have waited for the new member for Epsom to be driving this bill, I do not know.

I would like now to outline the most significant changes recommended by the committee. The committee has recommended the inclusion of an overview clause to explain that safeguard measures are one of several trade remedies available, and to explain the difference between them. This is a useful addition to the bill. It will assist in guiding potential users to the most appropriate form of remedy, to fast track remedies. The committee identified a number of provisions in the bill that granted the Minister of Commerce the discretion to exercise power—and by the way, I am enjoying working with the new Minister of Commerce, the Hon Craig Foss. He is well over these issues, he clearly understands the importance of them, and he has given me the opportunity to move things along with my portfolio responsibilities around commerce.

Terminating or reducing the provisional or final safeguard duty—that is what it includes—are the powers the Minister is given, and also refunding provisional duties, and exempting certain countries from safeguard measures. The bill included in the definition of “safeguard measure” any other action the Minister considers appropriate. So the Minister in this context is very important, and this bill gives the Minister of Commerce quite a lot of authority, both legal and moral authority, in the new legal authorities as defined by the bill. It updates the 1987 Act, which was simply inadequate circa 2012 in protecting New Zealand industry and commerce against unfair competition and in delivering remedies at the border.

This is what this bill does, and I congratulate the select committee. It is not riveting stuff for the select committee, but it is important stuff for the future of this nation. I would like to note that at the Committee of the whole House I will be authorising a Supplementary Order Paper to make minor technical amendments to the bill, as recommended by parliamentary counsel.

Finally, I would like to thank again the members of the committee for their thorough examination of this bill. It is well designed. The trade policies allow New Zealand firms to operate in a more predictable environment. These policies play an important role in providing New Zealand industries with confidence to invest, confidence to grow, confidence to employ people, and, more important, confidence that they can compete on the world stage, which is made uncompetitive by some trading nations that would otherwise take advantage of this small State. That is what this bill does. It aligns all of the protocols with the World Trade Organization rules. I recommend the bill to the House.

I am delighted to rise and speak to the Trade (Safeguard Measures) Bill, having been one of the people on the Foreign Affairs, Defence and Trade Committee who, at the time, considered this measure. The member who has just resumed his seat, the Minister for Regulatory Reform, who was standing this evening in his capacity as Associate Minister of Commerce, was right to draw attention to the fact that this bill was first of all introduced to the House in September 2008. It proceeded to the select committee on 11 March 2009, the closing date for submissions was 14 April 2009, and we on that Foreign Affairs, Defence and Trade Committee received five submissions from interested groups and individuals—five submissions. So it was reported back quite promptly after its referral to the committee in the early days of this Government’s first term, and here we are, an election later, around about the same time—11 March 2009 was when it was referred to the committee—3 years almost to the day later, and it is finally appearing in front of the House.

It is quite extraordinary that this Trade (Safeguard Measures) Bill should have languished for so long on the Order Paper. There is no excuse for it, apart from the shambling, bumbling, incompetent management of the House that we have seen ever since this Government took office. That has only been underscored by the ridiculous speech we have just had to endure from the Minister who was moving it—or forgot to move it—for its second reading. So all of the responsibility for where this piece of legislation has finally arrived lies with the incompetent management of the House, which this Government is famous for. It is just lucky that very few members of the public actually realise what a bad job it makes of running this House, because if more people knew about it, they would be scandalised that the country and this Chamber could be run so incompetently. But there we have it.

When we considered this bill at the Foreign Affairs, Defence and Trade Committee, it was clear that it was a technical bill and it had a limited appeal outside of the select committee, and hence attracted only five submissions. But I think there is always a good reason in this House to air some of the principles by which this country’s trading relationships are governed. I think this is another opportunity to do that, and I welcome that opportunity.

First of all, this bill clearly aligns us with World Trade Organization practice, as the Minister so meticulously read from his notes a moment ago. It makes us consistent with World Trade Organization regimes, and there are some reasons why that is a good thing. These reasons are not universally agreed with across this House, so it is worth traversing them, I think. In terms of the trade portfolio, New Zealand has enjoyed for quite some time now a bipartisan approach, and that is right and proper. The major parties, the National Party and the Labour Party, have for many years now agreed on a bipartisan approach to trade, and there are very good reasons for that. We are too small a country, and we have too short an electoral cycle, to allow our trading policy to be changed, potentially, every 3 years. There is no good purpose served for foreign direct investors, whom we welcome, or for our exporters if our trading arrangements and the policy framework that our trading arrangements are set by are changed, potentially, every 3 years.

So it has been a sensible approach of both Labour and National to adopt a bipartisan approach to trade. I support that. When I had the trade portfolio in Opposition in the last term I supported that, and I was pleased to accompany the Minister of Trade on several occasions when he was signing free-trade agreements. He invited me to accompany him on the basis of our bipartisan approach. His predecessor, the Hon Phil Goff, extended the same courtesy to him when he was in Opposition—when the Minister now, Tim Groser, was in Opposition. That is a good thing. That allows for policy stability, and that is important for not only the productive sector of our economy but the relationships we have with foreign direct investors and the security that they can rely on in terms of our policy settings, regardless of whoever is the Government.

So this bill was no trouble at the select committee. It is, in fact, a slightly modernising bill, but, who knows, the rules can change in the future, as well. But in this sense it is modernising. It actually hands over to some of the expertise that we have in the Ministry of Economic Development—or whatever it was before Steven Joyce got hold of it; I hope those people of expertise are still there—the ability to examine safeguard measures to ensure that New Zealand is adequately protected in its trading arrangements: that at our borders, safeguard measures are applied that prevent dumping, and that prevent illegal trading arrangements that would undermine and disadvantage New Zealand. There are ways of coping with these things if we think they have happened, and they lie in the disputes procedures in the World Trade Organization system. Those disputes procedures are referred to here, as well.

This bill, although it will not set the world alight, at least will not bring our trading relationships to a close. I think that it should progress, but let the Government not be under any illusion that we are impressed with its ability to bring this bill, which was ready 3 years ago, to the House at this late stage. A little more attention to detail is helpful when the parliamentary programme and the Order Paper are being devised and are being constructed. Surely the Ministers—the Minister of Trade in particular, but also the Minister of Commerce—have been warned about this by officials. I am sure officials would have said: “Ministers, this bill needs to proceed. We are getting seriously behind the play with World Trade Organization rules and regimes, and it is time to bring this into order.” This bill does that and I commend it to the House. Thank you.

It is a pleasure to speak on the Trade (Safeguard Measures) Bill. I too want to congratulate the excellent Associate Minister of Commerce, the Hon John Banks, on his moving the second reading of the bill in this timely fashion.

It was intriguing to hear the Hon Maryan Street make some comment about how long it had taken to bring this bill in. But I note that in actual fact it was introduced under a Labour Government in 2008. After 9 long—what did she say—shambling, bumbling, incompetent years of management, finally a good National Government was able to take over this bill, and now here we are today bringing it through the second reading.

This indeed is a technical bill, and indeed it is important to New Zealand. I can think of my own electorate, Hunua, which is responsible for a great deal of exports—in particular, producer goods such as tomatoes, such as garlic, such as onions. They are all good for you. They are all good for growing bonny babies. These are the sorts of things that can be dumped, and have been dumped, in New Zealand, and that is what this bill is all about.

It is important to point out that by definition safeguard measures are emergency measures applied at the border, usually in the form of a duty, to temporarily protect a domestic industry from a surge in imported goods. As I think the Hon Maryan Street said, these safeguards conform with World Trade Organization rules, and therefore are appropriate for safeguarding our very important international exports.

The other point I wanted to note was that the Hon John Banks had commended the Foreign Affairs, Defence and Trade Committee for its excellent work, and, in particular, the leadership of the honourable John Hayes. Mr Banks did ask why the bill had waited for him in order for it to come into the House. Well, indeed, this is the Hon John Banks’ second coming and it is fitting and nice that he is able to bring in this technical bill. It is something that is very much consistent with one of the issues that is dear to John Banks’ heart, and that is, of course, basic economic growth of the New Zealand economy. Indeed, it is one of the very, very important parts of the framework that are going to bring that about.

After all, over the last few years New Zealand under National—and, I must say, under the previous Labour Government—has forged a variety of free-trade agreements. In the next 3 years we will be leading at least 28 high-level missions to Asian countries to expand trade and business links. We will also continue to pursue high-quality trade agreements, including the Trans-Pacific Partnership and bilateral free-trade agreements. Once again, whenever we enter into these free-trade agreements there is always the problem of dumping occurring. That is why, technically, this bill is so important.

💬 Hon Member: Rev it up.

Rev it up? Well, you see, over on that side, we had those 9 long—what did she call them—shambling, bumbling, incompetent years of management, and in those days of very, very dire concern for New Zealand, when there was a world economic crisis, how did Labour handle it? Absolutely abysmally.

Here we are today, fortunately, bringing in this highly constructive technical bill. As John Banks pointed out, the bill prevents New Zealand from receiving a rapid influx of cheap imports. It allows time for New Zealand businesses to bring themselves up to the level of international competitiveness required to stay afloat. As a temporary measure, New Zealand consumers will continue to have the benefit of the free-trade principles that underpin New Zealand’s trading environment. It can also have a positive effect on investment, as it can help balance economic swings so that long-term investments may be safer. Finally, an effective safeguard regime can help build support for future trade liberalisation amongst domestic manufacturers that compete with imported trade. So I am very glad to commend this bill to the House.

To reiterate my colleague Maryan Street’s sentiments, the Trade (Safeguard Measures) Bill is a bipartisan bill; I took over from Maryan as our trade spokesperson. Traditionally, the bill has always been a bipartisan issue. That is a principle that I will adhere to, but can I make a couple of observations. Mr Banks has come into the House tonight—

💬 Hon Nathan Guy: He couldn’t resist it.

Oh, absolutely! Well, for some reason this is the second time in 2 weeks where I have followed Mr Banks in a speech, and the ammunition and fodder is just too good to resist, in that somebody left the crypt door slightly ajar, yet again, and the old dinosaur came out and decided that he would take credit for everybody else’s work. The interesting point is this: he made a far better effort than he did almost a week ago tonight, when his first salvo in his professional performance as a Minister was to introduce a piece of legislation that I will not go into in any detail about at all, because it is not worth it, but just suffice to say that the bill repealed 31 pieces of legislation that were spent and effectively repealed anyway. That was an absolute doozy, so we have made progress, I say; we have made progress tonight. A week later Mr Banks has gone back to the crypt, dusted off a few old books and a few bits and pieces, and somebody said: “Banksy,”—to quote him—“we’d better stick you out on a pole and give you a bill to go back into the House that has some degree of substance in it.”

I have to say, in all seriousness, that this bill does have a high degree of substance. This may not be the sexiest piece of legislation to come before this House, but it is vitally important, and I give credit to the last National speaker, actually, Dr Paul Hutchison, and my colleague for highlighting the safeguards and the necessity of this bill. It is a bill of substance. That answers another question as to why it did languish since 2009. Yes, it was introduced by a Labour Government in September 2008. Colleagues on the other side might recall they then won an election and there was a change of administration a couple of months later, but the reason this bill of substance languished was that it actually had substance in it. It was not a political slogan, it was not the usual sort of National Party slipshod, like the Minister of Justice’s old sort of “lock ‘em up, throw away the key”—all good populist stuff that you could rev a few people up in the provinces over. No, no, this probably does not have a lot of political capital that you can use to get a 5, 6, or 7-second grab on the 6 o’clock news and beat up on somebody. No, this is a bill of substance. This is not the sort of hollow bill that we normally get: normally a couple of pages long, a good slogan on the front, a political pamphlet, but actually it does nothing.

This is a bill of substance, and that is why, of course, it languished for 3 years, because they just wanted to get all the propaganda out and all the sort of hollowed-out stuff—the political pamphlets and the slogans. This is an important piece of legislation. Mr Banks would do well not to trivialise it, because what it does do is it brings us in line and makes us consistent with the World Trade Organization. I know there are members in this House, and in other places, who deride the World Trade Organization. Mr Banks made one point—we all sat up and took notice because it was the only valid point he has made in his last two contributions in the Parliament—in that the rules-based system of the World Trade Organization is indeed important. It is important because those countries that are vulnerable now have a regime where they can take disputes to an institution internationally, have their case heard, and have judgments made. Of course, we were, after 100 years, colleagues, I think, a recipient of that regime in the Australian apples case—

💬 Hon Maryan Street: 97 years.

Ninety-seven years, my colleague says. I believe that the Aussies, our brothers and sisters over there—our best mates whether we like them or not—are still resisting our apples, but we had a judgment. We could go to an international institution, make our case, have it heard, and have a valid decision made. That is why a rules-based system, I would argue, is important, rather than those who deride the World Trade Organization as some sort of unrepresentative body, even though it is represented by ambassadors who in the vast majority of cases are appointed by democratically elected Governments and take their positions and their decisions from capitals made up of democratically elected Governments. So I support this bill.

Debate interrupted.

The House adjourned at 10 p.m.