In rising today to speak on the Defence Trade Controls Bill 2011, I think it is worth noting that it is less than a week since we as a parliament were addressed by the President of the United States. During his address, President Obama reiterated the closeness and the strength of our defence relationship and paid tribute to our continued contributions in support of that relationship. This alliance represents our most significant defence relationship and has provided assurance to our national security and our regional security for many decades. It is a relationship codified in the ANZUS alliance, which has been the cornerstone of our security and defence since the Second World War and which this year celebrates its 60th anniversary.
I make these points because the legislation before us today is a key component of that relationship. The Defence Trade Controls Bill 2011 may not represent the headline components of our security arrangements with the US, but it does deal with perhaps the most important aspect of our defence and security relationship—that is, the sharing of defence technologies and information. While some may assume that the only thing Australia gains from the alliance is some promise of support in protecting our borders in exchange for the deployment of our forces in US operations, that is a simplistic and shallow analysis of what is in fact a deep and multifaceted relationship from which Australia gains great benefits. Most notably—and important to the debate before us today—is the transfer and sharing of defence technologies and materials. As the Minister for Defence Materiel mentioned in his second reading speech, some 50 per cent of our war fighting assets are sourced from the United States. This includes some of the iconic technologies with which we associate our defence forces—Black Hawk helicopters, F-18 Super Hornets and Abrams tanks. Along with their component technologies and materials, they were all developed in the United States and sourced from defence suppliers there.
I would like to commend the Minister for Defence Materiel on today's announcement of new capability for the special forces in Afghanistan. He announced today that we are getting 437 new Carl Gustav 84 millimetre guns and some thermal sights. I went to Afghanistan earlier this year with my colleague. I very much enjoyed the trip and gained a great insight and understanding of what our troops are doing and what they are achieving in Afghanistan. As with all soldiers, one of the issues they constantly talk about is capability. They are always aspiring for the latest capability they can get their hands on, particularly for the special forces, for whom the best capabilities can often be the difference between life and death. So I commend the Minister for Defence Materiel on the purchase of this new materiel to enhance the capability provided to special forces in Afghanistan. I know it will be greatly appreciated.
The iconic technologies I mentioned beforehand are just some examples of the many technologies, materiel and capabilities that we have gained from our relationship with the US. Trade with the US allows us to benefit from some of the latest and best defence technology in the world. It also allows our forces to be interoperable with US forces in our global deployments in Afghanistan, Iraq and elsewhere and, should the unthinkable occur, in the defence of our own national interests.
It was noted by the Minister for Defence Materiel that some 85 per cent of our military equipment will need to be replaced over the coming 10 to 15 years. This reality highlights the immense importance of maintaining our defence trade relationships, particularly with the United States. The Defence Trade Controls Bill 2011, if passed, will bring into force the Australia-United States Defence Trade Cooperation Treaty and it will close some of the gaps in our current defence trade controls. This treaty between Australia and the United States was entered into in September 2007. Last year the United States senate recommended its ratification in the US, and the US congress passed implementation legislation to give effect to the treaty. However, as part of the legislation passed by the US congress, the President of the United States is required to be sure that we have legislation enacted here in Australia that strengthens the control over the trade of defence goods and technologies.
It has been noted that Australia's current defence trade controls do need amendment to ensure that they not only meet the requirements of the treaty with the US but also reflect international best practice. Australia's current trade control regime was last looked at in the 1990s, and a lot has changed in the world since then. Indeed, it has been noted that while data held on a CD and exported would be captured under current arrangements, the same data, should it be transmitted over the internet, would not be subject to regulation. Obviously this is neither sustainable nor acceptable and that is why the Department of Defence has outlined four gaps in the current arrangements. The first is the intangible transfer of technology listed in the Defence and Strategic Goods List. The second is the provision of services related to goods and technology listed in the same list. The third addresses brokers arranging the supply of goods, technology and services to states or criminal organisations, including terrorist organisations. The fourth is the export of non-regulated goods that may contribute to a military end use that may prejudice our national security. Considering those issues, it is obvious that we had to do something. To not act would mean that Australia would not only lose the benefits of the treaty but fail to live up to our international obligations in regulating defence trade.
This leaves the government with but two options: to allow industry to self-regulate or to legislate better controls. Legislation has been shown to be the most appropriate and effective method of implementing these kinds of controls. Given the risk which a possible breach of trade rules would pose to our international reputation and ongoing defence treaties, allowing industry to self-regulate is just not appropriate. This does not mean that industry has not played a key part in the consideration of the legislation. Indeed, the formation of this legislation included three phases of consultation with industry, as the member for Solomon has pointed out. There was a treaty awareness phase in 2008 followed in 2010 and 2011 by two rounds of consultation on the legislation itself. These consultations were well attended by industry. As a result, the legislation has been amended to take into account the concerns of industry.
The government understands that there will be some costs incurred in complying with the legislation; however, there will be many benefits from this legislation in the long term for the Australian defence industry, particularly that of being recognised as a member of the approved community. Being a member of this community will remove the requirement for individual licences for each export and will ultimately allow much easier trade and defence relations. Also, the government will not levy a fee for applications, making transition to the new arrangement easier.
As I said at the beginning, this legislation is very important. It is very important for ensuring that our defence industry can trade with overseas partners. It is very important for ensuring that we maintain a technological advantage. It is very important for our ongoing defence and security relationship with the United States. Finally, it is very important for ensuring that we implement global best practice in the control of the trade of defence materiel and technologies. I commend the bills to the House.