Can Queensland get around CER rules to favour locals ahead of Kiwis?

The prime minister has revealed the government is looking into a new Queensland procurement policy that could exclude Kiwi companies doing business with the state’s government.

Speaking to media at his weekly post-cabinet press conference, Bill English says the government “will follow up” to make sure the ‘Buy Queensland’ procurement policy, announced last week by Queensland premier Annastacia Palaszczuk, is consistent with the two nation’s Closer Economic Relations (CER) agreement.

This follows Trade Minister Todd McClay last week saying he was seeking advice from lawyers about the legality of the new policy, which is to be implemented on September 1.

The scheme was announced at the Australian Labor party’s state conference last weekend and would mean local businesses would receive weightings of up to 30% when government contracts were being considered.

The policy would mean reconsidering Australia and New Zealand’s free trade agreement, Ms Palaszczuk says, adding that it is “not good” for the state.

“We are not talking about wholesale protectionism, we are talking about putting Queensland first,” she said.

“If the Australia-New Zealand government procurement agreement gets in the way of that, we will go it alone.”

Mr English says the government is representing the interests of both the Kiwi businesses who could potentially be affected by the new rules, as well as the “interests of open trade [between New Zealand and Australia.]”

“We have a CER agreement with Australia and we want to be sure New Zealand firms aren’t being penalised [by] a policy that was inconsistent with the agreement.”

Mr McClay has previously said on Australian radio that the policy is “a bit crazy” adding that legally he does not think the plan is even possible.

He said Queensland exported $5 billion worth of goods and services to New Zealand every year and there are “probably 20,000 or 30,000 Queensland jobs as a result of that.”

“To say that governments are only going to focus on what happens in a square block around their businesses really is going to limit the opportunity for the Queensland economy to grow,” he told the programme.

In a written statement provided to NBR, Mr McClay was more reserved.

“I am disappointed to hear the premier say this, as it seems short-sighted and lacks an understanding of how trade works.

“My advice to her is to get out a bit more, and I invite her to New Zealand. She might find more work for Queensland businesses while here.”

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