The committee is left in no doubt that in respect of the Commonwealth
treaty-making process there is a groundswell for change backed by compelling
evidence and practical suggestions for improvement. The committee received evidence
from leading industry bodies, the union movement, academic experts and other
stakeholders voicing frustration with the lack of effective consultation and
parliamentary engagement during treaty negotiations.
Much was made 20 years ago of a so-called 'democratic deficit'
surrounding treaty-making. The reforms introduced in the mid-1990s, following the
landmark Trick or Treaty? report, strengthened the treaty-making process
and gave parliament a greater say through the establishment of the Joint
Standing Committee on Treaties (JSCOT) and the mandatory tabling of treaties in
both houses of parliament. However, a 'democratic deficit' has remained a
feature of the process, albeit with a different complexion today as the scope
and reach of trade agreements into domestic law is unlike anything previously seen.
While the 1996 reform package was undoubtedly ground-breaking at the time,
twenty years on the global environment in which trade agreements are negotiated
and community expectations of transparency and accountability have changed to
such an extent that the case for review and further reform is compelling.
Debate on treaty-making no longer revolves around the underlying issue
of the role of the executive versus parliament and the use of the external
affairs power. The committee chose not to address parliament's constitutional
reach into treaty-making, other than to note that there may be no
constitutional barriers to parliament playing a greater role in the
In recent years the debate has shifted direction—to consider the way that
large and complex free trade agreements such as those with Korea, Japan and
China and the Trans-Pacific Partnership (TPP), are encroaching on the Australian
domestic sphere without an adequate level of stakeholder engagement, public
consultation, parliamentary oversight and executive accountability. The
committee agrees with Associate Professor Weatherall's contention that
balancing transparency and accountability in treaty-making with the need for
government to negotiate and secure outcomes that further Australia's national
interests is a conundrum that does not lend itself to easy resolution.
The committee found it significant that nearly all witnesses challenged two
major claims by the Department of Foreign Affairs and Trade (DFAT): that
Australia's current treaty-making process is effective, workable and reflects a
careful balancing of competing interests; and that the parliament plays a
significant role in relation to the scrutiny of treaties. The evidence was overwhelmingly
critical, and occasionally scathing, of these claims. Three key points were raised
in evidence to the inquiry. First, that there needs to be a significantly
higher level of consultation in treaty-making before agreements are
signed and that more information should be communicated to stakeholders and the
public about how agreements will affect them. Second, that parliament should
have opportunities to play a constructive role during negotiations that goes
beyond rubber-stamping agreements after they are signed. Third, that proposed
treaty action should be subject to independent assessment at the commencement
of negotiations and monitoring and evaluation after implementation, to ensure that
mistakes and unintended consequences are not repeated.
This is precisely the space where the committee has sought to add value.
The package of recommendations in this report address the following issues
around the treaty-making process:
transparency: ensuring a higher level of transparency
through parliamentary and stakeholder access to draft treaty text on a
confidential basis during negotiations;
consultation: improving the effectiveness of parliamentary
and stakeholder consultation during negotiations; and
independence: ensuring independent analysis of treaties at
the commencement of negotiations and, if required, post-implementation.
A major sticking point for stakeholders was being kept in the dark about
the text of draft treaties during negotiations and having to voice concerns
'blindfolded', as one industry group put it. The committee heard a range of
evidence on this issue, most of which was critical of the negotiation process
in one way or another. The committee does not accept that the process is as 'open'
as DFAT makes out, or agree with the department's inference that a large number
of stakeholders who have been consulted, possibly in the hundreds of thousands,
had no reason to make a submission to the inquiry because they were satisfied
with the process.
Openness implies access to information and this is not occurring during the
negotiation of free trade agreements as the committee heard from stakeholders.
The committee is unable to speculate on the views of stakeholders that did not
While the committee accepts that absolute transparency in treaty making
is an unrealistic expectation, absolute secrecy in the current globalised
environment of treaty-making is equally unrealistic and therefore in need of
changing. The argument that it is in Australia's national interest for texts of
bilateral and plurilateral treaties to be kept confidential prior to signature
is increasingly under challenge. The committee acknowledges that the practice
of keeping aspects of trade negotiations secret has a long history going back
to the original General Agreement on Tariffs and Trade negotiations in 1946–47,
but it has not always been so and international best-practice appears to be
heading in the opposite direction. Criticism from academic experts and
consideration of contemporary international practice demonstrates that absolute
secrecy in trade negotiations is a relatively recent development reflecting the
proliferation and complexity of agreements where significant and long-term
commercial interest are at stake.
The committee believes that the benefits of increased transparency
during free trade negotiations outweigh a perceived risk to the national
interest from public disclosure. However, the committee has not recommended
publication of draft text before negotiations are completed as there are other
ways of sharing information short of publication. Divulging draft text may be
detrimental to achieving the best outcome possible and may breach
confidentiality agreements signed when negotiations begin. Other more sensible
and practical suggestions were raised in evidence that could be implemented
during future trade agreement negotiations.
The committee accepts that transparency is not an all or nothing
proposition and may apply at different levels in treaty negotiations. A more
flexible approach to transparency may be preferable to mandating the public
release of every draft treaty, depending on the nature of the agreement. This
is consistent with the negotiation process followed by some of Australia's
trading partners which vary to a significant degree. The committee believes
that this report's careful approach balances confidentiality with the
desirability for transparency and is in tune with emerging international
An additional concern for the committee is that community confidence in
the negotiation of FTAs is probably at its lowest ebb in Australia, fuelled in
part by excessive secrecy around TPP negotiations, the content of leaked draft
chapters and the politicisation of debate. Accusations of scaremongering
against those asking reasonable questions and voicing their concerns are not
That DFAT consults widely and uses the resources available to pursue the
best outcome is not in dispute. The committee accepts that gaining access to
DFAT negotiators for private briefings was not a major problem for
stakeholders, but the effectiveness and usefulness of the briefings was called
into question by many. In consulting with stakeholders, quantity was a poor substitute
for quality. One witness valued the opportunity for occasional meaningful
engagement with DFAT negotiators, but observed that discussions with DFAT
around their negotiations '...have only convinced me that we can do better'.
In a similar vein, another witness recalled: 'It is nice to have the
conversation but it is not a very high-value engagement at the moment'.
And still another expert lamented that DFAT consultations are very much 'one
way' with negotiators 'listening but rarely responding'.
At issue for the committee is the lack of meaningful and effective two-way
communication. Stakeholders are at a distinct disadvantage in not having access
to treaty text, negotiating positions and policy frameworks during negotiations.
A challenge for DFAT is that its negotiators are not subject matter experts
across the latest developments in Australia and other jurisdictions. The
committee is concerned that the size and reach of modern FTAs and the interplay
of chapters dealing with complex issues such as copyright and intellectual
property (IP) is creating policy and administrative challenges which DFAT does
not yet fully understand.
The committee believes there is an urgent need for DFAT to rethink and
review its negotiation strategy from the perspective of stakeholder expectations
and internal departmental resourcing priorities. This is why the committee recommended
that DFAT put in place a process for sourcing expert advice and assistance in
areas that may be beyond the technical competency of its negotiating team.
Access for members of parliament
The committee is concerned that Australian federal parliamentarians are
not generally able to access treaty text at any stage before an agreement is
signed and tabled in parliament. This is unacceptable given that the negotiators
and elected officials (and their staff) of Australia's trading partners have long
had varying degrees of access under strict conditions of confidentiality. The
trend in trade negotiations on both sides of the Atlantic has seen a gradual
move away from secrecy towards transparency and controlled access to treaty
text by parliamentarians and industry stakeholders. In this context, it is
significant that the Obama administration has recently endeavoured to entrench
practical access arrangement into domestic law through its 2015 TPA bill.
While the committee welcomes reports of belated access for Australian
parliamentarians to the draft negotiating text of the TPP, this development has
definitely come too late in the process, given that negotiations are nearing
completion and have taken place in secret since 2008.
The committee heard no evidence that access arrangements for
parliamentarians are in any way preventing governments from negotiating
agreements in the national interest. Yet this continues to be Australia's
official line of resistance to change. There is an opportunity for Australia to
follow the European Union (EU) and the United States in making the negotiation
process more inclusive, less secretive and, ultimately, more accountable to
At the other end of the policy spectrum, the committee was not convinced
by renewed calls to legislate for parliamentary approval of treaties. Evidence
to the inquiry relied on the view of some legal experts that limiting the power
of the executive by making treaty action conditional upon approval by both
houses of parliament would be consistent with the Constitution. Interesting as
this may be, it is not an argument for why Australia should proceed down the
path of parliamentary approval. The committee is of the view that the arguments
add nothing new to the current inquiry, ignore the political reality of their
likely rejection by government and provide an easy target for those opposed to
change of any kind. Now is not the time to be distracted by the issue of
parliamentary approval, which has not been able to gain political traction in
Australia, as demonstrated by parliament's rejection of a private member's bill
mandating parliamentary approval as recently as 2012.
A role for parliamentary committees
There are other practical and incremental ways to improve parliament's engagement
in treaty-making. This report has pointed out the way of the future, building
on the work of existing parliamentary committees and their expertise
accumulated over many years. Most importantly, there is more that JSCOT can do
as a specialised and expert committee to scrutinise and review proposed
treaties during the negotiation process. It is not lost on the committee that
JSCOT already has the means within its resolution of appointment to undertake
inquiries into agreements at any stage during their negotiation, but only if
matters are referred by either house of parliament or by a minister. It would
appear that a lack of political will may have prevented JSCOT from realising
its full potential in this regard.
Evidence to the committee confirmed that JSCOT is a respected committee
with a significant body of work and precedent behind it. However, the committee
sensed that, over time, confidence in JSCOT's role may be eroding as the scrutiny
work it performs on behalf of the parliament is increasingly seen as 'too
little, too late' and 'rubber-stamping' agreements already signed by the
executive. With regard to the work of the Parliamentary Joint Committee on
Human Rights (PJCHR), this relatively new committee has an opportunity to
extend its reach into treaty-making and align its existing mandate to the
scrutiny of proposed treaties against the backdrop of Australia's international
human rights obligations.
The committee has made recommendations for how JSCOT and the PJCHR can play
more constructive roles in shining a spotlight on treaties, including issues and
documents pertinent to them, during their negotiation and before they are
signed. There is also scope for the two committees to work more closely
together in the treaty-making space and benefit from sharing each other's
experiences and expertise.
Independent analysis and monitoring
Executive responsibility for treaty-making should not prevent
independent assessment and monitoring of treaties, especially large and complex
FTAs. Equally, it should mandate that government be more up-front with
parliament and the public about the national interest reasons for pursuing an
agreement. Parliament and the executive should not be seen as mutually exclusive
players in treaty-making—a greater role for one does not automatically diminish
the authority of the other. The executive should not continue to use its
constitutional power over treaty-making as an excuse for rejecting further
The committee recommended that government prepare and table in
parliament two documents at the commencement of negotiations: a detailed
explanatory statement setting out the government's priorities, objectives and
reasons for entering into negotiations; and a cost-benefit analysis prepared by
an independent body such as the Productivity Commission. Both documents should stand
referred to JSCOT for inquiry and report.
These documents and their referral to JSCOT will significantly improve
the level of information available at the commencement of negotiations and go
some way to restoring public and stakeholder confidence in the process. The cost-benefit
analysis should be reviewed when an agreement is finalised, but before it is tabled
in parliament, and a supplementary analysis undertaken if circumstances warrant
it. This is especially important for free trade agreements which are many years
in the making and where the economic and social forecasts underpinning an agreement
change significantly over time.
The committee did not hear one positive word about the National Interest
Analysis (NIA) and regulatory impact statement which accompanies each treaty.
They do not appear to add much value to the process and, in the absence of a
cost-benefit analysis, bring to the table an insufficient level of detail.
During the inquiry, stakeholders drew the committee's attention to the negative
effects of agreements such as the AUSFTA and KAFTA and the fact that these
negative outcomes were not even included as a possibility in the NIAs which
It is not surprising that NIAs paint a favourable picture of a trade
agreement's potential benefits—that they are prepared by the department
responsible for negotiating, consulting and finalising FTAs was singled out for
criticism by witnesses. The committee believes that NIAs should be prepared by an
independent body such as the Productivity Commission and their scope
considerably expanded to include human rights, environmental and health impact
assessments (consistent with the domestic reach of current international agreements).
The committee believes that its recommendation in relation to the NIA should allay
the concerns of stakeholders on this particular issue. A more comprehensive NIA,
prepared at arms-length from government and accompanied by an independent
cost-benefit analysis, would represent a significant improvement on the current
The committee was somewhat dismayed to learn that, given the high volume
of treaties Australia has negotiated since 1901, of which 1800 remain in force,
DFAT negotiators commence each new free trade agreement with a 'blank piece of
paper', as described by one witness. The end result is the accumulation of
vertical isolated agreements which must be horizontally navigated by business.
To address this phenomenon, the committee recommended that the government
create what was referred to in evidence as a template or framework agreement developed
by a consensus of industry bodies and other stakeholders through a negotiated
process. The point of template agreements is to create loose frameworks and the
necessary parameters to enable parties to debate the merits of particular
treaty proposals without having to speculate in the dark on the fundamental
policy parameters set by the government.
Navigation: Previous Page | Contents | Next Page