The China Free trade Agreement……..Some Facts and the Bigger picture.

I firstly want to make some comments about the Unions and the Labor party.

The Labor party was formed by the Unions as their Political Wing. The Unions themselves were formed to “stick up” for workers. Their peak body is the ACTU (Australian Council of Trades Unions).

On the other side of politics we also have Unions of Employers. They “stick up” for the Employers. Their peak body is the Liberal party of Australia.

There is one major difference between the two. The Unions are open to scrutiny and the Liberal party are not. Just look at the way they do their finances. Donations have been funnelled through various secretive foundations to hide the donors. Even their affiliated bodies such as the IPA are a secretive organisation. You just don’t know who funds them.

So that’s the background and the subject is the China Free trade Agreement and whether or not it’s good for Australia and Australians.

On Jon Faine’s program on Thursday 3rd of September, one of his guests was Senator Penny Wong. She and the labor party are opposed to parts of the China free trade deal. Not the whole thing, just the movement of people from China into Australia to do Australian jobs. (my words) After the 9am news Jon Faine had another guest, Andrew Robb, the Minister for Trade.

Robb of course said the claims by the Labor party were “Nonsense” and he went on to explain that the three trade Agreements with Japan, Korea and China, didn’t have a cigarette paper between them and that the Labor party were racist in their approach.

Robb also started raving on about the CFMEU, a union which had also complained of the China free trade deal as well.

The response by the CFMEU refuted the allegations of the Trade Minister

Andrew Robb has written this on his Website in response.

Whilst the Liberal party think the Free trade deal with China is the best thing since sliced bread, The CFMEU and the Labor party don’t think it’s a good idea at all.

Whilst the CFMEU is in the news in the Royal Commission into Trades Union Governance and corruption and being portrayed off those appearences as “Thugs”, their opposition to the free trade deal is labelled as Xenophobic (racist).

It is a basic tenant of polite society that disagreements should not contain such open and nasty jibes.

So who do we believe? The Liberal party or the CFMEU and Labor.

Firstly we should look at what they don’t like.

Their opposition to the China Free trade deal hinges on section 10, which deals with Movement of Natural Persons.

As is always the case, I like to have a look at the facts.

Because Andrew Robb said there wasn’t a cigarette paper between the free trade agreements, I did an analysis of the China, Japan and Korea Free trade agreements.

Before I do that I want to put something into perspective for people reading this article. It’s about Unions. I wrote about the history of Unions here recently but I want to illustrate why Unions really exist and why they are wary of the Movement of natural persons (Labour sourced from overseas).

When I was a young Police Constable in the 1970’s in England, I was working in an industrial area when I was directed to go to the scene of a suspected electrocution. The workplace was a transport company and the injured worker was 27 year old married man. He was washing a truck with a high pressure cleaning machine. His footwear was canvas basketball type shoes and he was standing in a puddle of water on a gravel surface.

I got there at the same time as the Fire Brigade, the ambulance had already left to take the man to the local hospital. I watched the Fire Brigade Station Officer make the machine safe by turning it off and unplugging it. He then opened the plug and showed me the state of the wiring in the plug. The Earth wire wasn’t connected to its pin and was either touching the active or the neutral wire. So the machine was not earthed properly. During it’s use the machine was live and had discharged to earth through the body of the worker and electrocuted him. He was dead on arrival at hospital.

Any Sudden death automatically goes to the coroner’s court to establish the facts. In this case I drew a diagram of the plug in my pocket book and asked the Station Officer to sign it which he did.

One of the things we also had to do was to attend the post Mortem. An experience which will remain with me for the rest of my life. We had to watch the whole procedure. When he came to the heart he held it in his hands and squeezed and little drops of blood appeared in the numerous “electrical petechiae” caused by the electric shock. This confirmed his death by electrocution.

So what has this got to do with the Unions?

OCCUPATIONAL HEALTH & SAFETY

Well I will tell you. All workplaces in Australia are governed by Occupational Health and Safety laws. Each State has an Occupational Health and Safety Act. These acts exist to protect workers like the 27 year old example above from harm when they go to work. There are regulations which cover Electrical equipment used on a worksite that it must be tagged and tested periodically to keep the used of that equipment safe from injury or death.

One only has to look at the number of industrial accidents in Victoria to see that there are still Deaths and injuries every day. As I am writing this I can tell you that Worksafe Victoria was 30 years old on 1 September 2015.

I can also tell you that in 1985 in Victoria there were 58,700 injuries to workers which has fallen to 26,500 in 2014. That is from 161 for every day of the year in 1985 to 73 injuries per day in 2014.

An integral part of a Union’s duties is to protect members of their union whilst at work.

Might this in fact explain the behaviour of the CFMEU in withholding their labour at various sites? Maybe they are not safe?

What has this to do with China and the movement of natural persons.

Well I don’t think the Unions believe that Chinese workers generally have the same standards of Occupational Health and safety that we have in Australia.

This is evidenced by the horrendous accidents that have happened in China just in the chemical Industry with great loss of life.

According to the Economist in 2012 Workplace accidents in China killed 70,000 people

So we have established that there are some difficulties with Occupational Health and Safety in China.

Lets look at the Skills of various trades and how they are obtained.

TRADES TRAINING IN AUSTRALIA.

In Australia we have a skills training system (also known as TAFE (Technical and further Education) which fits into what is known as the Australian Qualifications framework.

Many of the Skills required are required all around Australia so the training in a Trade is approved and is the same in each State so a qualification recognised in New South Wales is also recognised in Victoria. Some accreditation may be required however in some trades.

Each trade consists of a number of accredited modules and are delivered by accredited teachers at a Registered Training Organisation. All of the trades training have CORE modules which have to be passed. One of these is Occupational Health and Safety. Another might be Personal Protective Equipment. Still another might be a special module called confined space entry. Many modules require additional “tickets” after completion of their basic trade courses.

All of this training is Competency based. This means that you are either, competent to the requirement in the module, or not yet competent.

So a lot of training is required for a trades person to claim they are an Electrician or a Special class Electrician or a Fitter and Turner. Two people in my family are special class Electricians. Much of what they do is very technical and is done within a framework of a set of ever changing regulations. Of prime importance in their Jobs is the guarding of machinery so that when people work on the machinery they are not injured.

In Victoria there is an excellent enforcement regime which stops anyone getting away with an unsafe workplace. The Statistics from Worksafe above show that this regime has actually saved lives and reduced injuries BUT 72 injuries per day is still not a good result.

If foreign workers are allowed into Australia to work:

  1. What are their Qualifications?
  2. How safe are they?
  3. Is Labor market testing required before they are given a Visa?
  4. How is such an idea to be policed?

THE THREE FREE TRADE AGREEMENTS COMPARED.

The first comment to make is that we are talking about two Free trade deals (China and Korea) and an Economic partnership agreement. (Japan).

The number of chapters in each agreement are as follows. China 17 chapters, Korea 23 chapters and Japan 20 Chapters.

The Chapter we are interested in is the one with the Movement of Natural Persons. China Chapter 10, Korea Chapter 10 and Japan Chapter 12.

I searched the PDF files for the main agreement and all other relevant documents on the page for specific words such as Employer, Employee, Skills and then read the entire section where those words appeared.

I have condensed down the relevant sections of the documents.

They are as Follows.

CHINA

page 115 in Chapter 10. (MOVEMENT OF NATURAL PERSONS)

ARTICLE 10.4: GRANT OF TEMPORARY ENTRY

  1. Each Party shall set out in Annex 10-A the specific commitments it undertakes for each of the categories of natural persons specified therein. The Parties may make commitments in respect of the temporary employment entry of natural persons.
  2. Where a Party makes a commitment under paragraph 1, it shall grant temporary entry or extension of temporary stay to natural persons of the other Party to the extent provided for in that commitment, provided that those natural persons:

(a) follow the prescribed application procedures for the relevant immigration formality; and

(b) meet all relevant eligibility requirements for such temporary entry.

  1. In respect of the specific commitments on temporary entry in this Chapter, unless otherwise specified in Annex 10-A, neither Party shall:

(a) impose or maintain any limitations on the total number of visas to be granted to natural persons of the other Party; or

(b) require labour market testing, economic needs testing or other procedures of similar effect as a condition for temporary entry.

  1. Each Party shall limit any fees for processing applications for temporary entry of natural persons in a manner consistent with Article 10.3.
  2. Temporary entry granted in accordance with this Chapter does not replace the requirements needed to carry out a profession or activity according to the applicable laws and regulations in force in the territory of the Party authorising the temporary entry.

Then we need to look at Annex 10A.

 

ANNEX 10-A

SPECIFIC COMMITMENTS ON THE MOVEMENT OF NATURAL PERSONS

Section A: Australia’s Specific Commitments

  1. Australia requires a natural person of China seeking temporary entry to its territory under the provisions of Chapter 10 (Movement of Natural Persons) and this Annex to obtain appropriate immigration formalities prior to entry. Grant of temporary entry in accordance with this Annex is contingent on meeting eligibility requirements contained within Australia’s migration law and regulations, as applicable at the time of an application for grant of temporary entry. Eligibility requirements for grant of temporary entry in accordance with paragraphs 5 through 11 of this Annex include, but are not limited to, employer nomination and occupation requirements

BUSINESS VISITORS OF CHINA

  1. Entry and temporary stay shall be granted to business visitors of China referred to in paragraph 4(a) for a period of up to 90 days.
  2. Entry and temporary stay shall be granted to business visitors of China referred to in paragraph 4(b) for a period of up to six months, with the possibility of further stay for up to one year.
  3. A business visitor of China means a natural person of China who is:

(a) seeking to travel to Australia for business purposes, including for investment purposes, whose remuneration and financial support for the duration of the visit must be derived from sources outside Australia, and who must not engage in making direct sales to the general public or in supplying goods or services themselves; or

(b) a service seller, who is a natural person not based in Australia whose remuneration and financial support for the duration of the visit must be derived from sources outside Australia, and who is a sales representative of a service supplying enterprise, seeking temporary entry for the purpose of negotiating for the sale of services or entering into agreements to sell services for that service supplying enterprise

INTRA-CORPORATE TRANSFEREES OF CHINA

  1. Entry and temporary stay shall be granted to intra-corporate transferees of China referred to in paragraph 6(a), (b) and (c) for a period of up to four years, with the possibility of further stay.
  2. An intra-corporate transferee of China means an employee of an enterprise of China established in Australia through a branch, subsidiary or affiliate which is lawfully and actively operating in Australia, who is transferred to fill a position in the branch, subsidiary or affiliate of the enterprise in Australia, and who is:

(a) an executive or a senior manager, who is a natural person responsible for the entire or a substantial part of the operations of the enterprise in Australia, receiving general supervision or direction principally from higher-level executives, the board of directors or stockholders of the enterprise, including directing the enterprise or a department or subdivision of it; supervising and controlling the work of other supervisory, professional or managerial employees; and having the authority to establish goals and policies of the department or subdivision of the enterprise; or

(b) a specialist, who is a natural person with advanced trade, technical or professional skills and experience who must be assessed as having the necessary qualifications, or alternative credentials accepted as meeting Australia’s standards, for that occupation, and who must have been employed by the employer for not less than two years immediately preceding the date of the application for temporary entry.

(c) a manager, who is a natural person within an enterprise who primarily directs the enterprise or a department or subdivision of the enterprise, supervises and controls the work of other supervisory, professional or managerial employees, has the authority to hire and fire or take other personnel actions (such as promotion or leave authorisation), and exercises discretionary authority over day-to-day operations. This does not include a first-line supervisor unless the employees supervised are professionals.

INDEPENDENT EXECUTIVES OF CHINA

  1. Entry and temporary stay shall be granted to independent executives of China for a period of up to four years.
  2. An independent executive of China means an executive of an enterprise headquartered in China who is establishing a branch or subsidiary of that enterprise in Australia, and who is a natural person that will be responsible for the entire or a substantial part of the enterprise’s operations in Australia, receiving general supervision or direction principally from higher-level executives, the board of directors or stockholders of the enterprise, including directing the enterprise or a department or subdivision of it; supervising and controlling the work of other supervisory, professional or managerial employees; and having the authority to establish goals and policies of the department or subdivision of the enterprise.

CONTRACTUAL SERVICE SUPPLIERS OF CHINA

  1. Entry and temporary stay shall be granted to contractual service suppliers of China for a period of up to four years, with the possibility of further stay.
  2. A contractual service supplier of China means a natural person of China who has trade, technical or professional skills and experience and who is assessed as having the necessary qualifications, skills and work experience accepted as meeting Australia’s standards for their nominated occupation and is:

(a) an employee of an enterprise of China that has concluded a contract for the supply of a service within Australia and which does not have a commercial presence within Australia; or

(b) engaged by an enterprise lawfully and actively operating in Australia in order to supply a service under a contract within Australia.

  1. Entry and temporary stay shall be granted for a period of up to four years, with the possibility of further stay, for up to a combined total of 1,800 per year, of Chinese chefs, Wushu martial arts coaches, Mandarin language tutors and Traditional Chinese Medicine practitioners, entering as contractual service suppliers of China.

INSTALLERS AND SERVICERS OF CHINA

  1. Entry and temporary stay shall be granted to installers and servicers of China for a period of up to three months.
  2. A natural person of China is an installer or servicer of machinery and/or equipment where such installation and/or servicing by the supplying company is a condition of purchase of the said machinery or equipment. An installer or servicer must abide by Australian workplace standards and conditions and cannot perform services which are not related to the installation or servicing activity which is the subject of the contract.

ACCOMPANYING SPOUSES AND DEPENDANTS

  1. For a natural person of China who has been granted the right of entry and temporary stay under this Chapter for a period of longer than 12 months and who has a spouse or dependant, Australia shall, upon application, grant the accompanying spouse or dependant the right of entry and temporary stay, movement and work for an equal period to that of the natural person.

Ends at page 118

Commentary on China agreement.

When you look at this agreement it appears that yes the people coming in under the arrangements actually need to be assessed according to Australian Standards. (Those described in the Education part of this paperabove).

The difference between this and the other two agreements is the side letter on

  1. Skills Licencing and testing and the
  2. Memorandum of understanding on Work and holiday Visa arrangements.

The Skills licencing and Testing side letter is the main reason I don’t like this Free trade agreement.

It is well worth while reproducing it in full.

17 June 2015

Mr Gao Hucheng

Minister of Commerce

The People’s Republic of China

Dear Minister Gao,

In connection with the signing of the China-Australia Free Trade Agreement (the “Agreement”) and discussions in relation to Chapter 8 (Trade in Services) and Chapter 10 (Movement of Natural Persons), I have the honour to confirm the following understanding shared by the Governments of Australia and China:

The Parties undertake to cooperate to streamline relevant skills assessment processes for temporary skilled labour visas, including through reducing the number of occupations currently subject to mandatory skills assessment for Chinese applicants for an Australian Temporary Work (Skilled) visa (subclass 457). Australia will remove the requirement for mandatory skills assessment for the following ten occupations on the date of entry into force of the Agreement.

Automotive Electrician [321111]

Cabinetmaker [394111]

Carpenter [331212]

Carpenter and Joiner [331211]

Diesel Motor Mechanic [321212]

Electrician (General) [341111]

Electrician (Special Class) [341112]

Joiner [331213]

Motor Mechanic (General) [321211]

Motorcycle Mechanic [321213]

The remaining occupations will be reviewed within two years of the date of entry into force, with the aim of further reducing the number of occupations, or eliminating the requirement within five years.

The Parties undertake to cooperate to encourage the streamlining of relevant licensing procedures and to improve access to relevant skills assessments. As part of this work, Trades Recognition Australia (TRA), the China International Contractors Association (CHINCA) and other institutions1 designated by the Chinese Government will cooperate with a view to expanding access to testing in China for an Australian Offshore Technical Skills Record (OTSR).

The Parties undertake to review progress in the above areas, as well as discuss avenues for further cooperation in the areas of skills recognition and licensing, within two years of the date of entry into force of the Agreement.

I have the honour to propose that this letter and your letter in reply confirming that your Government shares this understanding shall constitute an integral part of the Agreement.

Comments on the China Free Trade Agreements.

The highlighted Text in red is the problem. The removal of mandatory skills assessment testing in those occupations listed and then the remaining occupations (Which ones, does this mean all of them?) within 5 years and the establishment of testing in China to give certain skills an Australian Offshore Technical Skills Record. I take this to mean for an Electrician, the equivalent qualification that an Australian Electrician would have done through his apprenticeship.

In other words the trades training in Australia could become null and void and Suitably qualified Chinese workers under the 457 scheme brought in to do work here for Chinese firms.

The working Holiday Vias poses problems also

Primary purpose must be a Holiday

Allows 5000 workers in.

Not allowed to work for an employers for more than six months.

Must hold funds to onward journey or ticket.

ONE BIG QUESTION LOOMS IN MY MIND AT THIS JUNCTURE. HOW IS ALL OF THIS GOING TO BE POLICED?

KOREA

The relevant Chapter for Korea says the following.

Chapter 10 movement of Natural Persons

Intra-Corporate Transferees of Korea

  1. Entry and temporary stay shall be granted to intra-corporate transferees of Korea referred to in paragraph 7(a) for a period of up to four years, with the possibility of further stay.
  2. Entry and temporary stay shall be granted to intra-corporate transferees of Korea referred to in paragraph 7(b) for a period of up to two years, with the possibility of further stay.
  3. An intra-corporate transferee of Korea means an employee of an enterprise of Korea established in Australia through a branch, subsidiary or affiliate which is lawfully and actively operating in Australia, who is transferred to fill a position in the branch, subsidiary or affiliate of the enterprise in Australia, and who is:

(a) an executive or a senior manager, who is a natural person responsible for the entire or a substantial part of the operations of the enterprise in Australia, receiving general supervision or direction principally from higher-level executives, the board of directors or stockholders of the enterprise, including directing the enterprise or a department or subdivision of it; supervising and controlling the work of other supervisory, professional or managerial employees; and having the authority to establish goals and policies of the department or subdivision of the enterprise; or

(b) a specialist, who is a natural person with advanced trade, technical or professional skills and experience who must be assessed as having the necessary qualifications, or alternative credentials accepted as meeting Australia’s standards, for that occupation, and who must have been employed by the employer for not less than two years immediately preceding the date of the application for temporary entry.

Contractual Service Suppliers of Korea

  1. Entry and temporary stay shall be granted to contractual service suppliers of Korea for a period of up to one year, with the possibility of further stay.
  2. A contractual service supplier of Korea means a natural person of Korea who has trade, technical or professional skills and experience and who is assessed as having the necessary qualifications, skills and work experience accepted as meeting Australia’s standards for their nominated occupation and is:

(a) an employee of an enterprise of Korea that has concluded a contract for the supply of a service within Australia and which does not have a commercial presence within Australia; or

(b) engaged by an enterprise lawfully and actively operating in Australia in order to supply a service under a contract within Australia.

Accompanying Spouses and Dependents

  1. For a natural person of Korea who has been granted the right of entry and temporary stay under this Chapter for a period of longer than 12 months and who has a spouse or dependent, Australia shall, upon application, grant the accompanying spouse or dependent the right of entry and temporary stay, movement and work for an equal period to that of the natural person.

Commentary.

What does this mean. Foreign Skills assessment again? assessed as having the necessary qualifications, skills and work experience accepted as meeting Australia’s standards for their nominated occupation

JAPAN

The relevant Chapter for Japan says the following.

N.B.The Full Agreement is in two parts, The Partnership agreement and the implementation agreement.

 

The words Skill, Labour (in a context of jobs in Australia), employee do NOT appear anywhere in this document. But are in the Annex 10 which is SPECIFIC COMMITMENTS

ON THE MOVEMENT OF NATURAL PERSONS

See Section 4 Assessment

Section 4

Contractual Service Suppliers of Japan

  1. Entry and temporary stay shall be granted to a contractual service supplier of Japan for a period of up to one year, with the possibility of further stay.
  2. A contractual service supplier of Japan means a natural person of Japan:

(a) who has trade, technical or professional skills and experience and:

(i) who is an employee of an enterprise of Japan that has concluded a contract for the supply of a service within Australia and which does not have a commercial presence within Australia; or (ii) who is engaged by an enterprise lawfully and actively operating in Australia in order to supply a service under a contract within Australia; and

(b) who is assessed as having the necessary qualifications, skills and work experience accepted as meeting the domestic standard in Australia for their nominated occupation.

  1. Entry and temporary stay of a natural person who is seeking entry and temporary stay pursuant to paragraph 1 is subject to employer sponsorship. Full details of employer sponsorship requirements, including the list of eligible occupations for sponsorship, are available on the website of the Australian government department responsible for immigration matters. Employer sponsorship requirements and eligible occupations may change from time to time.

There are no other side letters which affect the assessment of Employees.

CONCLUSION

The issues which arise as a result of the China free trade agreement are nothing to do with the Tariffs between countries or the trade of Goods.

In my mind they are the following

1/ The skills training regime in Australia has been under pressure from successive Liberal Sate governments reducing the amount of funds for training in the trades for a long time now. The Andrews Labor government in Victoria put back $350 million into TAFE in their last budget whilst the NSW Liberal Government have also been reducing funding also

2/ As part of the competencies for a trade are mandatory subjects like Occupational Health & Safety. China has an Occupational Health & Safety problem.

3/ If 5000 workers are allowed in under the Working Holiday provisions how is this going to be policed? There are many seasonal farms and much has been in the press recently about workers in 7/11 on such visas being underpaid as well as chicken processing plants hiring contracted Labour at under award rates of pay.

4/ Minister Robb says that the same restrictions on bringing in Labour are here as were here under the   Labor Government. That is not so. He has cancelled mandatory assessment for 10 trades in the side letter

5/ What regulations are in place to actually make sure that Australian workers are offered jobs first?

6/ Finally these free trade agreements will be governed by an Act of the Australian parliament. In such Acts of parliament there are provisions (if so drafted) to allow regulations to be made by the Minister responsible. These regulations then become the law of the land.

Much has been talked about the Unions and their thuggery. The Liberals would have you believe that it is so. Yet watching the evidence at the Royal Commission I haven’t seen it. The evidence is weak or nonexistent. It’s just a lot of hot air. Watch this video to see what I mean

The same with the charge by the Liberal party of Xenophobia (racism). There is no evidence for that either.

Perhaps all the Unions are doing is protecting the hard won skills of Australians, protecting their safety at work and also their Australian jobs.

Perhaps all the liberals are trying to do is to cry “Wolf” once too often, using their usual outrageous emotive and thoroughly mendacious tricky slogans.

Is this another way to reduce the wages of workers? By importing them. It smells like the usual liberal plot.

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6 thoughts on “The China Free trade Agreement……..Some Facts and the Bigger picture.

  1. Reblogged this on The Kettle Press and commented:
    ChAFTA contains troubling clauses. It is not xenophobia as the Government claims. If opposition was xenophobic, all three FTAs would be slammed. None of the FTAs are slammed. Just the provisions in the side letter of the ChAFTA, which are alarming and dangerous.

  2. This is work that should have been done and compiled by the Opposition [Labor}
    They cannot say it would never be published because maybe concerning Murdoch they`d be correct but there are many way`s of publishing and Vince you have done the work here that Penny Wong should have presented
    Her office should accept this with open arms IMHO and use it as a working model for correlating the points most valid in these agreements.

    She does claim the ISDS clauses are something that Labor is against but where are they Vince
    I,like you did downloaded the agreements but where are the ISDS provisions-are the side letters ISDS or are they another whole new deal within a deal?
    Some questions can only be answered by Penny Wong because Andrew Robb will not answer anything
    Excellent investigative journalism Vince HUZZAH

  3. Pingback: The China Free trade Agreement……..Some Facts and the Bigger picture. | 2rhoeas3

  4. Through all this I see no benefits for Australia but a chance for Lawyers to embark on a new form litigation at the governments expense, That alone can be a nightmare and for how long Baring in mind the liberal cabinet are all lawyers. I can see area’s where manipulation can take place in favour of the foreigners to become citizens of Australia. Australia now has to extend hospital care plus , legal aid ,schooling and accommodation and so on . The reason I say this is we aren’t extending this service for our own. This alliance is in favour of the foreign parties and as there is a down turn in our economy this FREE TRADE SCEEM is obsolete …

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