Jan 30, 2014

Australia is a proud shipping nation and should remain one – Opinion – The Guardian Australia

The IPA’s call for a free-for-all on our coastal shipping routes seems to be based upon a simplistic view of maritime work along those lines: if it’s a third world flag, you can pay third world wages 

This summer I joined record numbers of Australians to visit the National Library in Canberra to see the remarkable Mapping our World exhibition.

The exhibition’s portfolio of historic maps from previous centuries charts the development in European understanding of the Australian continent, and clearly demonstrates the centrality of maritime exploration in first discovering and then mapping our Great Southern Land.

Countless other Australians have been spending the summer by the coast catching up with family and friends, enjoying our abundant natural assets. But as important as the coast is for recreational activities, it also plays a key role in driving economic prosperity.

Australia is an island continent and 99% of its trade is by sea. There is no nation on earth in which a viable shipping industry is so important.

It is remarkable, then, that the right-wing think tank the Institute of Public Affairs (IPA) has declared that an Australian-based shipping industry is unnecessary in recent lobbying for the dismantling of Labor reforms designed to guarantee the future of a viable Australian maritime sector.

In a recent article in The Australian, the IPA called for the Coalition government to scrap laws that mean that when foreign-flagged vessels operate between domestic ports in this country they are required to pay Australian-level wages.

It calls tax measures designed to remove disincentives to Australian shipping a “subsidy”. These measures arose from an extensive consultative process with the sector chaired by the treasury department.

When Labor took office in 2007, we were determined to reinvigorate Australian shipping given that the merchant fleet had declined by more than half to just over 20 ships during the Howard government.

We chose not to implement protectionist measures such as those in place in the United States, which exclude foreign-flagged vessels from domestic trade.

Instead, we provided incentives to enable Australian shipping to compete on a level-playing field with foreign competitors. Labor recognised that, even though these reforms were important for the economy, the arguments for maintaining a healthy Australian maritime fleet were much broader.

Australian seafarers make an important contribution to national security in a country with thousands of kilometres of uninhabited coastline.

An Australian industry is also important for the environment given the frequency and disastrous environmental impact of incidents around the world involving ships with flags of convenience. None of the serious maritime incidents I had to deal with as transport minister off the pristine Queensland or Western Australian coastline involved an Australian flagged and crewed vessel. A more serious incident on our coasts could cost many hundreds of millions of dollars.

A viable Australian maritime industry is critical for the 10,000 jobs that currently exist, but also to provide the skills base which is the foundation of our maritime sector.

Our industry develops the skills and experience needed to safely operate our ports, which together handle 10% of global trade. It provides the basis for our role in global maritime safety where we are the custodians of one sixth of the world’s surface.

The IPA’s call for a free-for-all on our coastal shipping routes seems to be based upon the view that crew on ships performing domestic tasks in Australia should be paid as if the work is being conducted in the country represented by the flag on the back of the ship.

In other words: If it’s a third world flag, you can pay third world wages.

That makes no more sense than allowing construction companies, or, for that matter, universities, to bring in workers to compete side-by-side with Australians but be paid one tenth of the wages for the same task.

It is a proposal to destroy our Australian industry which would lead to increased costs in the long term, not to mention the loss of the local fleet’s contribution to national security, environmental protection, employment and skills development.

Labor’s reforms to reduce costs for shipping, including tax incentives, depreciation, the promotion of an international register with competitive policy settings and workforce development were carefully worked through with all stakeholders following a unanimous parliamentary report. It is ridiculous to label these carefully considered reforms as “red tape”.

These reforms, implemented in full less than two years ago, should not be dismissed by ideology, but be given an opportunity to work in the national interest.


* This opinion piece appears in The Guardian Australia today