Russell Broadbent (McMillan, Liberal Party) Share this | Hansard source

It is fortuitous that we are having this debate at a time when 90 per cent of Victoria has been declared to be in exceptional circumstances. My contribution to this debate follows the contribution made by the member for Hotham, who was the Minister for Primary Industries and Energy in the Labor government from June 1991 to December 1993. While the Labor government was in power, he stood up to his thighs in green grass in the good times in Gippsland. In his time as a minister he has also seen the tears of rural communities falling in the dust on dry ground. He has lived through this and will know exactly what I am talking about. I do not for one moment come to this House to blame anybody for the difficulties we face as a community together across Australia. The member for Hotham probably has a broader knowledge of the issues than anybody in his party, particularly with regard to rural Australians and the people who have had to face up to these most difficult times. Coming from the community that I come from, where we normally have an abundance of water and green grass, he will understand what it is like to stand with farmers in the bottom of their empty dams when they are spending $250 per day just to cart water for their stock.

I hope the Howard government and this parliament will be seen as the best friends the Australian farming community has ever had. This government is determined to keep farmers farming through these difficult times of drought by holding the line in support of farming families to ensure their futures in agriculture and the futures of their collective community; by standing in support of the farming women who, in turn, support their men; by standing in support of the men of the land, who are held up by rural women; and by standing beside the children of farming families in the knowledge that, like their parents and their grandparents before them, they too will have a future in agriculture, not only in Gippsland in Victoria but throughout the nation.

I welcome this opportunity to speak on the Farm Household Support Amendment Bill 2007. Representing a rural electorate as I do, I am painfully aware of the serious impact that years of drought have had on our farming communities and rural businesses, which rely on water for their very prosperity. In my electorate of McMillan, that impact has been devastating. It goes beyond what the member for Hotham explained as exceptional circumstances. We now understand that exceptional circumstances triggered the Australian government relief for farmers that was put in place in 1992. In my area we are now enduring what I have termed extraordinary circumstances, which profoundly affects all aspects of rural life.

The Howard government has responded with compassion to the plight of our farming communities during the progress of this extended dry period. Since coming to office, it has expanded and refined the application of exceptional circumstances, which were first accepted in 1992. In 1999, agreement was reached on new criteria for exceptional circumstances, and these are the criteria we use today. This was followed in 2000 by a review of EC, which led to the recognition of buffer zones where farmers living in close proximity to a declared area could also apply for assistance. In 2002 the government agreed to provide immediate access to drought assistance as soon as an application for an exceptional circumstances declaration was received. This prima facie declaration meant that farmers immediately became eligible for income relief for six months even if the National Rural Advisory Council subsequently recommended against the declaration.

The reforms to the exceptional circumstances process continued in 2005 with a new drought package. That drought package increased the interest rate subsidy level from 50 per cent to 80 per cent for farm businesses in their second or subsequent years of EC declaration, doubled the off-farm assets threshold and introduced a $10,000 annual offset against the income support test and an automatic reassessment process for exceptional circumstances declared areas nearing the end of their second year of assistance.

More recently, the government announced two further expansions of its drought assistance program. In October 2006 there was a significant policy change to EC arrangements that extended income support payments and interest rate subsidies to all eligible producers. This removed the differentiation between producers such as irrigators, dryland farmers and dairy farmers in certain exceptional circumstances declared areas. In November 2006 exceptional circumstances drought relief was further extended to include thousands of small businesses that derive a minimum of 70 per cent of their income directly from agriculture. This meant that people like harvesting and fencing contractors; seed, feed and fertiliser merchants; livestock carriers; shearing contractors; and farm machinery businesses could access assistance.

The bill now before the House will give effect to these important changes. It will enable small business operators dependent on agriculture to gain access to relief payments and ancillary benefits such as concessions under the youth allowance and Austudy. It also gives effect to the current ex gratia arrangements for small business income support and sets out the criteria that will determine eligibility, to ensure the assistance is available to those small businesses most affected by this most difficult drought. It will clarify the position of small business operators who could also be considered farmers and might not be eligible for assistance under the current criteria. The Farm Household Support Amendment Bill 2007 will also affect the Social Security Act 1991 and the Age Discrimination Act 2004. The changes to the Social Security Act are necessary to enable small business owners to gain access to concessions under the youth allowance and Austudy means tests. These are already available to farmers.

The bill before the House also makes a number of changes to the Farm Household Support Act in order to bring it into line with the Age Discrimination Act. The Attorney-General has provided an exemption from the provisions of the Age Discrimination Act to enable EC relief payments for both small business operators and farmers to be calculated according to their age. Those sections of the Farm Household Support Act that have age qualifications that do not already have exemptions under the Age Discrimination Act will be removed when this bill is passed.

The Howard government’s response to the unfolding issue of what has become the worst drought in living memory has been both measured and timely. In consultation with farming groups, individual farmers, small business operators and community groups, it has introduced change when needed. As was pointed out in the second reading speech of the Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry, the Australian government has provided $1.3 billion in drought assistance since 2001 and is committed to a further $900 million to the year 2008.

Some measure of the seriousness of this drought can be drawn from its impact on those parts of Victoria’s South and West Gippsland regions that make up my seat of McMillan and the seat of Gippsland, held by the Minister for Agriculture, Fisheries and Forestry, Peter McGauran. In more normal times, this area is regarded as one of the most stable and consistent rainfall areas in our state. However, the cumulative effects of the past 10 years have had a severe impact on the dairy industry in particular, one of the mainstays of our regional economy. Each year, as the drought progresses, there is mounting concern as we miss out on any meaningful autumn breaks and get well below average winter rainfall, the lifeblood of the dairy industry.

What concerns me most about the impact of the drought in my electorate is the unfolding human and animal welfare crisis. After 10 years of worsening conditions, we have now reached the point where it is likely that a significant number of the most vulnerable dairy farmers may well not survive into the future. The least resilient and therefore the most at risk of being lost to the industry are the sharefarmers and leaseholders, considered by most as the future of the dairy industry in our area. They are struggling to maintain the value of their only real asset, their herds, which have dropped to about half their value at July last year. My office has been inundated with calls from farmers and their families at the end of their tether, physically and financially, and not knowing where to turn for help. We have had stories of several hundred farmers across the electorate paying as much as $250 a day, as I mentioned before, just to cart water in order to keep their livestock alive.

In southern Victoria the countryside in normal years supports perennial pasture species. This is no longer the case. Because of the drought, our farmers are now facing the additional burden of having to resow these pastures. With no pasture, fodder stocks have also been exhausted, and the same farmers have had to borrow substantial sums to pay huge feed bills, with round bales six to eight times their normal price. Much of this debt is owed to cooperatives that have to be repaid. The result of this is that even when dairy farmers in my electorate get back to meaningful production many of them will face the prospect of receiving no milk cheques—or very little of their milk cheques—until their loans are paid back.

Apart from the farmers, who are bearing the brunt of these effects of the drought, milk factories have also been seriously affected. The Murray Goulburn Cooperative Company, the largest dairy processing company in Australia, has reported a drop of 14 per cent in the daily deliveries of milk. It has had at least 50 suppliers quit the industry across Victoria, and I suspect this number will increase. Murray Goulburn has a major plant at Leongatha, in the centre of my electorate of McMillan, in the heart of one of Australia’s most important dairying regions. The company’s chairman, Mr Ian MacAuley, said its future viability is critical to the prosperity of the region and of the state of Victoria. Murray Goulburn has invested heavily in its Leongatha plant, and Mr MacAuley said future investment plans of more than $200 million relied on the continuing strong productivity of the dairy farm sector.

For the past six months I have been visiting and talking to farming groups, individual farmers, industry and community leaders and regional water authorities. These talks resulted in a strong case being put to the Minister for Agriculture, Fisheries and Forestry and his Victorian state counterpart to have exceptional circumstances declared in the four shires that make up the majority of my electorate of McMillan.

I have also made these concerns known to the office of the Prime Minister and to the Prime Minister himself when the opportunity presented itself when he came to Garfield recently for an announcement on extending broadband opportunities. The Prime Minister then stood on ground that was bare. Whilst the individual farmer himself had water and feed for his cattle—it was not a dairy farm but a beef farm—he explained to the Prime Minister as we looked across Koo Wee Rup swamp from where we were standing on the Garfield hills that those down there were desperate for water and feed.

As I have said, the conditions being experienced by farmers in parts of my electorate—and I am sure in many electorates around the country—are beyond exceptional circumstances and are surely this time extraordinary circumstances. Farmers occupy and manage 60 per cent of Australia’s land mass and know better than anyone how harsh the Australian climate can be. In periods of exceptional circumstances the best and most experienced farmers are normally able to cope as a result of forward planning and decision making based on their experience. But, in the present circumstances, even some of the most experienced farmers are struggling, and I fear there will be many farming operations that simply will not survive this drought.

I have been standing on the parched earth of McMillan. It is not something I remember well, though we have experienced droughts before. I grew up in a dairy-farming community. I grew up with the people that lived on the land. I have milked cows for a very short time—I think a week; I found it was not for me. I hold in awe those people who milk twice a day and who are out there struggling—for some, for the first time in their lives. These are people I mentioned just before. These people are not struggling farmers; these people are very, very good farmers. These people are across our nation. I know that they are not only in my area; I know they are in Tasmania. I know I am speaking to people across the nation on dairy farms. But I am telling you now that for the second time in Gippsland—and we have had a drought going on for 10 years; since 1997 this drought has been afflicting us—this has brought us to a stage where there has been no run-off since May last year in these areas that I am talking about. Even though we would have snippets of rain and you would come down to some parts of the electorate and you would say it was green, there is no water there.

The reason I have been pleading with my own minister, Peter McGauran, and with Joe Helper in Victoria, is that we are seen in Gippsland as not needing exceptional circumstances assistance. That is why I keep calling them extraordinary circumstances, because I have been to the farms and I have stood at the bottom of the dams. I have seen the efforts that these farmers have gone to to prepare for exceptional circumstances—to prepare to have the water available to them. But now there is so little water. We now have competition between the towns and villages for the same water that used to be available to the farmers, and we cannot take the same steps to help the farmers.

It is put to me, ‘Well, hang on, Russell, there are farmers throughout Australia who run out of stock water and cart that stock water or remove the cattle.’ This does not happen in Gippsland. We have creeks drying up in Gippsland that have never dried up in 60 years of memory. They have now dried up and they are not running today. We get a little bit of rain and they can pick up.

I have gone out on a limb on this issue with my minister and with Joe Helper with the Victorian government—and, can I say, there is no blame game. Why I say there is no blame game is that I know the officers in the Victorian department and the officers in the federal department have been doing their very best to see whether these areas can fit into our current exceptional circumstances arrangements. To a degree we cannot, but we are prepared, I hope, as a government to declare interim exceptional circumstances, because I can tell you, if we do not get autumn rain and if this nation does not get autumn rain, there will be a lot more people on our plate for this nation to look after.

We do have a responsibility to our rural communities that feed us, look after us and export for us, remembering that 70 per cent of this milk is exported overseas. But when they are having a tough time, isn’t it right that the communities in the cities, through their taxes, support these people as best we are able? I repeat again: we are not supporting inefficient farmers; we are supporting efficient farmers, determined farmers, third-generation farmers, who are saying, ‘I am not going to lose this farm because my dad had it and my grandad had it.’ I know there are members in this House today that have stood with farmers exactly the same as those people. That is why I say we have got to hold the line to support farming families to ensure their futures in agriculture and the future of their collective communities. We are talking about the loss of community. We are really talking about the future generations, standing beside the children of farming families in the knowledge that, like their parents and their grandparents—the generations before them—they too will have a future in agriculture. I commend the bill to the House.

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