Kelly, Craig, MP

Mr CRAIG KELLY (Hughes) (17:20): It gives me great pleasure this afternoon to speak on the Australian Crime Commission Amendment (National Policing Information) Bill 2015 and the Australian Crime Commission (National Policing Information Charges) Bill 2015. Effectively, these two bills bring our two national policing information intelligence assets, both CrimTrac and the Australian Crime Commission, together under one banner. The legislation allows a merger between those two important organisations that we have that do so much to fight the threats of terrorism, international drug trafficking and cybercrime. Firstly, I will just give some background on each organisation. CrimTrac was established in the year 2000 under an intergovernmental agreement between the Commonwealth and state and territory governments to: … enhance Australian law enforcement with an emphasis on information-based policing facilitated through rapid access to detailed, current and accurate police information. The services that CrimTrac provides include: the National Police Checking Service, which is effectively criminal history checking; the national child offender system, comprising of the National Australian Child Offender Register and the Managed Person System; the National Police Reference System; and a national firearms identification system. As at June 2015, there were 207 employees working in CrimTrac. The Australian Crime Commission commenced as our national crime intelligence agency in 2003, replacing the National Crime Authority, the Australian Bureau of Criminal Intelligence and the Office of Strategic Crime Assessment. Its specific focus is on serious and organised crime of national significance, and its main functions set out in the act are to: collect, correlate, analyse and disseminate criminal information and intelligence and maintain it in a national database; undertake intelligence operations; investigate matters relating to federally relevant criminal activity, where there is serious organised crime, Indigenous violence or child abuse; and report its outcomes, operations and investigations and provide criminal information and intelligence to the ACC board. Having these two organisations merge into one makes simple logistical sense, especially when we are asking our federal law enforcement officials to do more and more work. The merger offers strategic opportunities to national policing sectors, and I will give just a few specific examples: increasing the connectivity between the national intelligence and police information agencies; enhancing the quality and timeliness of information and intelligence delivered to front-line officers; improving agency and national productivity by removing duplication and providing a single vision for the agencies; and enhancing the national threat picture, providing better evidence to inform operational and decision-making activities. As I said, bringing these two organisations together will help them work more efficiently and more effectively. One area where we have been requiring them to do a lot more work because of government policy has been the area of illicit tobacco. There were a few major busts of illicit tobacco late last year. In September 2015, there was a seizure at Port Botany of 47 tonnes of illegal tobacco, which were cigarettes branded with the Manchester brand, manufactured in the United Arab Emirates, imported into Australia for sale, simply avoiding the excise. With this one shipment, it was estimated that there were $9.1 million in import duties and excises avoided. The people that were arrested were found with an incredible amount of cash—$700,000. It gives you some idea of the profitability of these criminal activities if they are able to have $700,000 lying around in cash. That was followed by an even bigger seizure the following month, in October 2015, which was actually the biggest illegal tobacco shipment ever seized by our law enforcement officials. That was 71 tonnes of illegal tobacco with a value of $40 million on the black market. Yet despite these successes, according to a recent report by KPMG, something like between 14 per cent and 14½ per cent of the tobacco sold in Australia is from illicit sources—that is 2.5 million kilograms of illicit tobacco currently being sold on an annual basis throughout Australia. The duties avoided are $1.42 billion—that is $1.42 billion in duties that would have been paid had these products been sold legally through the system. I would like to put on record that I am an avid antismoker. Cigarettes, I think, are the bane of our society. I cannot stand the smell of cigarettes. I would like to see smoking rates in this country reduced to zero, and we should have policies that do exactly that. But if we continue to increase the rate of duties on cigarettes, all that we do is create greater and greater opportunities for black-marketeers. By increasing the rate of duties in Australia, we are effectively creating an underworld trade. If we do not effectively work on the individual's demand for cigarettes and we just jack the prices up, we create a black market. That is what we have been doing in this country. The retail price for a packet of cigarettes in the Philippines is $1.38. In Vietnam it is $2.20. In China it is $3.13. Even in Japan it is $4.83, and that is the retail price not the price in any volume or the wholesale price. If we increase the price on a packet of cigarettes from around $20 currently up to $40, we are simply going to supercharge the black market for illegal tobacco in this country. The only people cheering and celebrating such a move would be the black-marketeers, the smugglers, the bootleggers and the criminals. Yet this is what Labor want to do. We know that the member for Watson stood at that dispatch box and said that Labor's plan to raise more revenue for them to spend was an additional excise of $47 billion on smokers. There are currently only 2½ million smokers in Australia. The Labor Party's policy is to slug each smoker in this country with additional taxes of close to $20,000 per person. That will set fire to the black market. It will turbocharge that market. We know—all the numbers show—that the largest proportion of our society that smokes is in the lower socioeconomic groups So the Labor Party are proposing to slug the people with the least ability to pay an increase in tax an extra $20,000 a head. For the average smoker that is an additional $20,000 a head. What will this do to the black market? We already have a significant problem there. We are already asking our crime and law enforcement authorities to spend a significant proportion of their time in tracking down illegal tobacco—and this is while legal tobacco is at current prices. If we think we can simply raise the excise that smokers have to pay by another $47 billion without setting off an avalanche of illegal tobacco imports and creating more and more work for the Australian Crime Commission, then we need to think again on this issue. A further point that needs to be made concerns one of the other major and important jobs that our Australian AFP and our Crime Commission are doing, and that is processing mail. A recent AFP annual report states: The International Mail Processing and Disruption Strategy was initiated in response to an Australian Customs and Border Protection Service report of a significant increase in the volume and frequency of illicit drug and precursor importations through international mail. So what is happening? We are getting more and more illegal products: drugs and precursors; and, of course, it will also be the same with tobacco. These products are simply being sent through our mail system—again creating more work for our law enforcement organisations. One particular concern that I have is the current arrangements that Australia has with the Universal Postal Union. The Australia Post submission to the Productivity Commission inquiry several years ago states: In the case of Australia Post, the payments it receives under the UPU’s terminal dues system (being the payment from other postal administrations for the processing of inbound international mail … up to 2 kilograms … is well below the cost of delivery within Australia. Being a net importer, this means that Australia Post incurs a substantial loss on the processing of such mail. For example, in the financial years 2010-2012, Australia Post estimates that it will make a loss of A$1.06 per inbound international airmail packet (parcels less than 2 kilograms) on a volume of approximately 39.7 million articles. That was in 2010-2012. We have, since that time, seen an explosion in the number of airmail parcels that come into this country. The principle of the Universal Postal Union was originally that each nation bears its own cost in sending international mail. That system may very well have been appropriate for the 1950s, the 1960s, the 1970s or even the 1980s, when most of the international mail was simply personal or business correspondence; it was letter based. That system was justified then. There may be reason to subsidise a system where more letters were being received into Australia than were being sent out, but there cannot be a reason to subsidise a system that involves commercial transactions where goods are being sent through the post. The current agreement that we have with the Universal Postal Union is that Australia Post subsidises overseas companies to send goods, as a commercial transaction, into Australia. We know this is occurring at a time when we already have substantial costs with our law enforcement agencies having to monitor the large amount of mail that is coming in. These organisations have said that they are seeing a significant increase in the volume and frequency of illicit drugs and precursor importations. This is something that we need to look at. Perhaps we need to help offset the costs to our law enforcement officials through the goods coming through the postal service. We are already subsidising them to the tune of perhaps $100 million. This legislation is important. Merging the two crime-fighting agencies should put them in a stronger position to continue their good work and keep the Australian public safe from terrorism and the importation of illegal drugs. I commend this bill to the House.