- Introduction and initial reflections
Overview
1.1Throughout the inquiry many participants expressed the need for greater transparency, accountability, and oversight in the process for negotiating Australia’s trade agreements. These claims were largely associated with the encroachment of trade agreements on more areas of policy and law-making, and a wider impact on stakeholders and the public as the scope and complexity of trade agreements has increased over time. This interim report discusses evidence received to date outlining ways to improve Australia’s approach with a focus on stakeholder consultation and engagement, the provision of information to the public and the role of the Parliament. It also considers post-implementation review and assessment of agreements.
1.2The Department of Foreign Affairs and Trade (DFAT) undertakes an extensive range of stakeholder consultation and engagement activities in the development of Australia’s trade agreements. Submitters and witnesses outlined limitations with current consultation processes including a lack of structure and consistency as well as a lack of transparency, particularly the inability to access draft agreement text as negotiations progress. These limitations were suggested to reduce the capacity of stakeholders to provide informed and valuable feedback to government.
1.3Subsequently, proposals are made for greater transparency and accountability in consultation processes, enabling more in-depth input from affected stakeholders and those with relevant insights and expertise. It is suggested that enhanced engagement can avoid unintended consequences and contribute to improved trade negotiation outcomes for Australia. With regard to improving transparency in consultation, the approach taken in the United States (US) through its trade advisory committee system and cleared advisor framework, was identified as informative for Australia. Some participants advised that enshrining an approach to stakeholder consultation in legislation would provide consistency and durability, while others suggested that it could reduce flexibility to adapt to different negotiations and types of agreements.
1.4The provision of information to the public is an important aspect of the development of trade and investment agreements. Submitters and witnesses suggested that greater transparency, accountability, and oversight could be achieved by making more trade negotiation information publicly available including negotiating mandates, draft text, and final agreement text. The approach taken to the publication of information in the European Union (EU) is considered.
1.5The authority to enter into treaties, including trade and investment agreements, is an executive power under the Australian Constitution. However, the Parliament plays an important role in providing accountability and oversight in the development of these agreements. This interim report considers proposals made for the Parliament to have a greater role before commencement, during negotiations and at signing at ratification. For comparison, the role of the Congress in the US and the Parliament in Canada are considered.
1.6Post-implementation review and assessment of trade and investment agreements are noted as being important to determine if agreements as negotiated remain relevant and continue to have their intended benefits, as well as whether broader impacts have changed over time. Further, the need for reviews to be undertaken periodically and by an independent body are considered.
Transparency, accountability, and oversight
1.7During the inquiry many participants expressed the need for greater transparency, accountability, and oversight in Australia’s approach to negotiating trade and investment agreements. The need for greater transparency, accountability, and oversight was most often raised in relation to stakeholder consultation and engagement processes, the provision of information to the public and the role of the Parliament.
1.8Several submitters described Australia’s current approach to trade negotiations as ‘secretive’ and as being conducted ‘in secret’ or ‘behind closed doors.’ For example, the Australian Council of Trade Unions (ACTU) stated that ‘…trade agreements are negotiated and finalised largely in secret and signed with very little, if any, public and parliamentary scrutiny.’
1.9Submitters broadly associated the need for greater transparency, accountability, and oversight with the potential impact of trade agreements on a wide range of stakeholders and the implications for many areas of policy and law-making, particularly as the scope of agreements has increased over time. For example, the Electrical Trades Union (ETU) related the need for greater transparency and accountability with the impact on affected stakeholders and the public:
Greater transparency and accountability is needed from those actually at the negotiating table, allowing oversight and input from important stakeholders and the wider public on deals that will affect their futures before, during, and after negotiations take place.
1.10Public Services International (PSI) also called for greater transparency and highlighted the role of parliamentary oversight:
Given the wide-ranging and serious implications these trade and investment agreements can have and the way in which they can restrict Parliament’s core function of legislating, it is important that there be transparency and parliamentary oversight in the negotiating process of these agreements.
1.11In their submission, ActionAid Australia observed a link between transparency and democracy, and compared the approach to negotiating trade agreements with the development of domestic policy:
Transparency in policy development processes is a crucial facet of democracy and enables the public to be aware of, feed into, and hold the government to account for the policies it implements. Given the broad implications that trade agreements have across a range of domestic policy areas in Australia, and for partner countries, it is imperative that trade negotiations have the same level of transparency as domestic policy-making processes.
1.12The Australian Fair Trade and Investment Network (AFTINET) stated that ‘… the process for negotiating, signing and ratifying trade agreements should be subject to the highest levels of public debate, scrutiny and democratic accountability to ensure that the benefits outweigh the costs.’
1.13Some submitters noted that while trade and investment agreement negotiations have traditionally been relatively opaque, they have evolved in recent years in response to a growing demand for increased transparency. For example, Dr Patricia Ranald, Convener, AFTINET explained the trend toward increased transparency:
… the demand from civil society and the public more generally about more transparency has been growing over the last decade. I think that historically… trade agreements have been considered to be a sort of domain of experts that other people can't understand. There's been this idea that they must be kept secret until the end of the deal, and they can only be revealed after the deal. I think that is changing globally, and it's pretty clear that in Australia people want it to change, too.
1.14Likewise, ActionAid Australia observed that: ‘The direction of travel at the international level is also towards greater transparency.’
1.15The ACTU suggested that other countries have made greater progress than Australia: ‘Australia lags behind other likeminded countries when it comes to transparency and public scrutiny of agreements.’
1.16Several submitters noted that multiple parliamentary inquiries conducted in recent years have made recommendations for greater transparency, accountability, and oversight in the Australian Government’s approach to the negotiation of trade and investment agreements.
About this inquiry
Objectives and scope
1.17On 9 August 2023, the Joint Standing Committee on Trade and Investment Growth (the Committee), adopted the inquiry following a referral from Senator the Hon Don Farrell, Minister for Trade and Tourism. In referring the inquiry, the Minister requested an interim report of initial findings.
1.18Throughout the inquiry to date, the Committee has received substantial evidence proposing how the Australian Government’s approach to negotiating trade and investment agreements could be improved with regard to both the process for developing agreements and the content of agreements.
1.19The interim report considers only some of the points outlined in the inquiry terms of reference and issues raised by stakeholders in evidence. This interim report provides an initial examination of the evidence proposing the need for greater transparency, accountability, and oversight in the process for negotiating trade agreements, with a focus on stakeholder consultation and engagement, the provision of information to the public and the role of the Parliament.
1.20The Committee’s final report will build on the interim report to consider stakeholder consultation and engagement with respect to First Nations and states and territories. In addition, it will further explore the evidence in relation to process with regard to determining the cost-benefit of trade agreements as well as the role of impact assessment. It will also examine the substantial evidence put forward in relation to the content of agreements.
1.21In undertaking this inquiry, the Committee acknowledges the strong track record of DFAT over many years in negotiating Australia’s extensive architecture of trade and investment agreements. Further, it recognises DFAT’s ongoing efforts to increase transparency in trade negotiations where possible and appropriate.
1.22Overall, the Committee is of the view that the Australian Government’s approach to the negotiation of trade and investment agreements has served Australia well and largely remains fit for purpose. However, as the scope and complexity of trade agreements increases it is necessary to ensure that Australia’s approach to negotiating trade agreements contains a corresponding level of transparency, accountability, and oversight in relation to key stakeholders, the public and the Parliament. In this regard, the Committee believes that there are some improvements that could be made to strengthen the approach and contribute to better negotiation outcomes for Australia.
1.23The Committee notes several previous parliamentary inquiries have made recommendations to improve transparency, accountability, and oversight in Australia’s approach to trade negotiations, most recently, the August 2021 Joint Standing Committee on Treaties (JSCOT) report titled Report 193: Strengthening the Trade Agreement and Treaty-Making Process in Australia. The Committee notes much of the evidence received in this inquiry is similar, and supports the recommendations made in the report.
Conduct of this inquiry
1.24On 10 August 2023 the Committee issued a media release to announce the inquiry and call for submissions. The Committee invited submissions from a range of people and organisations with an interest in Australia’s approach to negotiating trade and investment agreements by 22 September 2023. This included federal and state government departments and agencies, industry groups and peak bodies, think tanks, academics, unions, and the general public.
1.25At this stage of the inquiry, the Committee has received 54 submissions and an additional 10 supplementary submissions. The full list of submissions and other additional information presented to the inquiry are available in Appendix A.
1.26The Committee has held six days of public hearings:
- 13 September 2023 in Canberra, ACT
- 20 October 2023 in Canberra, ACT
- 3 November in Melbourne, VIC
- 15 November in Canberra, ACT
- 1 December 2023 in Canberra, ACT
- 13 December in Canberra, ACT.
- A list of witnesses who attended these public hearings is available in Appendix B. Transcripts for all public hearings can be found on the Committee’s website. Further public hearings may be held to inform the Committee’s final report.
Acknowledgements
1.28The Committee would like to thank everyone who provided written submissions and gave evidence at public hearings.
Report structure
1.29This interim report is structured in five chapters, including this introduction:
- Chapter 2 summarises current stakeholder consultation and engagement activities in the development of trade and investment agreements and explores issues raised that may limit their effectiveness. It also considers the value of stakeholder consultation to trade negotiations and presents proposals to improve transparency and accountability in consultation processes.
- Chapter 3 considers the provision of information on trade agreement negotiations to the public, including suggestions for negotiating mandates, draft text, and final agreement text to be made publicly available.
- Chapter 4 outlines the current role of the Australian Parliament in the development of trade and investment agreements and summarises proposals for a greater role for the Parliament in the oversight of agreements across the development of a negotiating mandate, during the negotiation phase, and at signing and ratification.
- Chapter 5 details the concept of post-implementation review of trade and investment agreements to determine if agreements as negotiated remain relevant and continue to have their intended benefits, as well as whether wider impacts have changed over time.