- Post-implementation review
- Many submitters outlined the need for greater emphasis on post-implementation review and assessment of trade and investment agreements. For example, the Australian Industry Group (Ai Group) stated:
While considerable resources are invested in assessing potential impacts during the negotiation phase, there is rarely ex post facto evaluation of how FTAs [free trade agreements] perform in real world trading conditions post implementation.
5.2The Productivity Commission stated that in its view: ‘Agreements should be reviewed periodically to ensure that they remain relevant, continue to serve the national interest and that the provisions negotiated are operating as intended.’
5.3The Productivity Commission further explained that reviews are necessary because negotiated provisions can become outdated and may need to be updated to remain effective:
Provisions that relate to trade in services and investment can easily be rendered ineffective by the existence of other barriers that lie outside the agreement that can stifle trade or investment and undermine the effectiveness of the provisions negotiated. The provisions in the agreements may need to be broadened to include these barriers if the desired objectives are to be achieved.
5.4The Electrical Trades Union (ETU) outlined that because ‘… changing conditions over time will affect the impact agreements have, regular periodic reviews of ratified agreements should also be instilled as a legislative requirement of the Parliament.’
5.5In its submission, Department of Foreign Affairs and Trade (DFAT) explained the current process for post-implementation review:
Where FTAs are assessed as likely to have a substantial and widespread impact on the Australian economy, a Post Implementation Review is to be completed within five years following implementation of the agreement.
5.6Several submitters emphasised that post-implementation review processes should include assessment of economic, social, and environmental impacts.
5.7Some also proposed that post-implementation review and assessment should be undertaken by an independent body, rather than by DFAT.
5.8The Australian Fair Trade and Investment Network (AFTINET), Public Services International (PSI) and the Australian Council of Trade Unions (ACTU) highlighted the need for post-implementation review and assessment to include public consultation and be made publicly available on completion.
5.9AFTINET commented on the independence and the level of public engagement in the current review process stating that ‘… is an internal government process with little public involvement… the process is not independent, since the reviews are conducted by the department that negotiated the agreements. The report is not published by DFAT, but by the Office of Best Practice Regulations and is very difficult to find.’
5.10It was suggested that post-implementation review and assessment be undertaken periodically, with several submitters nominating every five years as an appropriate timeframe.
5.11The ETU specified that a post-implementation review mechanism should apply to both new agreements and those agreements already in force.
5.12The Delegation of the European Union to Australia advised that the European Union (EU) undertakes a review into the operation and implementation of trade agreements five years after commencement, which includes input from stakeholders and is made publicly available.
Committee comment
5.13The Committee recognises the importance of periodic post-implementation review to determine whether trade and investment agreements, once in force, have operated as intended and had the expected benefits for Australians. Further, it is agreed that a robust review process should be undertaken by an independent body, provide clear opportunities for stakeholder and broader public input, and be made publicly available on completion.
5.14The Committee believes that to enhance public transparency and parliamentary oversight post-implementation reviews should be tabled in Parliament.
5.15The Committee notes the considerable evidence received to the inquiry regarding the determination of the national interest, cost-benefit analysis, and impact assessments to inform Australia’s approach to trade and investment negotiations both prior to commencement and during negotiations. These will be considered in the Committee’s final report.
5.16The Committee recommends that the Australian Government undertake independent reviews of trade and investment agreements to be held five years after the agreement comes into force, and at regular intervals thereafter, which are to be tabled in Parliament.
Mr Steve Georganas MP
Chair
31 January 2024