Tony Windsor (New England, Independent) Share this | Hansard source

I compliment the member for McMillan on his speech. I listened intently to it and I can assure him that there are other members in this House who agree wholeheartedly with the sentiments that he has conveyed. I would also thank the member for Hotham for the contribution that he made earlier. I remember the time that he was the primary industries minister. I know that many farmers, who probably were not Labor voters at the time, remember some of the initiatives that he put in place. I certainly do. I commend him for his interest in the agricultural sector over those years and since that time.

In recognising and supporting the Farm Household Support Amendment Bill 2007 before the House, I want to go to what the member for Hotham said, because I think he made some very important points in terms of policy and what we are actually trying to address. He made a very disturbing point, in my view, that, when this policy of support to small businesses was actually put in place, the projections were that 17,000 small businesses would apply and 14,000, I think he said, would be successful—and this was all in a report. Only 450 small businesses applied and 181 were successful in gaining support. I criticised the government at the time because they used different numbers to determine what a small business was. They were using 20 when it suited and 100 when it suited in other circumstances in the industrial relations legislation. There was duplicity in the numbers in terms of what a small business was. That matter has been addressed in this legislation.

At the time, it was promoted as an initiative to help those small businesses that were reliant on agriculture for their income and were suffering from the drought but were needed for the long-term viability of the farm sector in regional communities when the drought broke. There was a legitimate reason for supporting them. That number that the member for Hotham mentioned of 181 businesses successfully gaining support I find quite astonishing. I would like the minister to address this in his response, or maybe some members of the government could. If that is in fact the number, I think we really need to revisit this legislation. I thought the member for McMillan put this very well: this is not just about farmers; it is about communities. There is no doubt that there are a lot of small businesses out there—whether they be spray contractors, harvesting contractors or fencing contractors. Because the very nature of agriculture is changing, a lot more contract work is being done. Hence those businesses are an integral part of the future of agriculture. We really do need to make sure that there is genuine support going to those people. Like the member for Hotham, I am not convinced that this legislation will actually do that. Regrettably, the only way we will ascertain whether it will provide that support will be with hindsight. Hopefully, damage will not be done to those people, but it could well happen, and damage has been done in recent years.

I would also like to talk about the general support given to agriculture and the way various people, particularly in the media and in the city, some with political objectives—and, thankfully, I have not noticed it too much in this place—portray the support given to agriculture during a drought as exorbitant support. I think the government tends to be a little cute from time to time in terms of what is actually support for the farm sector. If you look at business support to agriculture during the worst drought in history—and I do not have the absolute numbers at this particular time, but I have raised this issue before and the minister can address the numbers—from 2001 to 2005, a four-year period, you will find that $242 million was spent on business support. Some people might know what business support means. It is exceptional circumstance interest rate assistance. In that period of time, the government argued that a vast amount of money was expended on farm support. Much of that support was by way of household assistance.

Household assistance is no different to the dole: unemployment benefits given to a family not receiving an income. In this case, it is a farm family who really needs to stay on the land to maintain the farm rather than leave the farm and seek income from another job. In that sense, that is not industry support; that is personal support to those households. In that particular four-year period, we have this extraordinary number: an average of $60 million a year in business support to the farm sector. As I said, I do not know what that number is today.

In her speech, the parliamentary secretary said that total support to the farm sector from the government over six years has been $1.3 billion, and she projected some hundreds of millions of dollars more into the future. My estimate of the business support to agriculture during that period of time is no more than about $450 million. Even being polite about it, say it is over five years, that is $90 million a year during the worst drought in living memory for a very important sector of our economy.

About 18 months ago, an article in the Australian said, and others were saying the same thing, that we cannot keep propping agriculture up. There was a myth being developed, aided and abetted by some people in the government that millions of dollars were going out to the farming community. When you track the actual business support, it would be lucky to average $100 million a year—I think it would probably be closer to $90 million. That is good support, and no-one is criticising that. But the majority of support going to farm families are unemployment benefits because there is no income going to those families. It is not correct for people in the press or in the parliament to say that that is an agricultural subsidy. Anybody who is unemployed in this country and who cannot find additional work will get support from government—so they should and so the farm sector should.

Let us look at other support in this country, bearing in mind that this is the worst drought we have had in living memory. Let us look at other industries, for example the building industry. When the GST was brought out—that was not brought about by a natural disaster; it was government policy, and a policy that I agree with—the government had an enormous response from the building industry, which said that a 10 per cent increase in the price of homes would destroy the economy, that there would be mass unemployment and that people could not bear the cost. So the First Home Owners Scheme was put in place. Since then, in a period of time comparable to that of the drought, nearly $6 billion of support has gone to the building industry, which is an average of about $1 billion a year. On average we give about $2 billion a year to the car industry and about $11 billion a year to other industries. Every time the Productivity Commission is asked to comment on subsidies to agriculture it says, quite rightly, that the support is quite low.

So it is grossly unfair for members of the media and some members of the parliament to suggest that enormous gratuities have been given to the farm sector. I support the member for McMillan. In these areas that are really suffering, we have to look to a policy initiative that actually does something on the ground. If the member for Hotham is right, and 180 businesses have support—if they are the only ones out of 17,000 who have support—then it says something about the policy mix, because I am sure the other 16,800 are not doing terribly well either. Surely there is a need to revisit that particular initiative.

I am not becoming a member of the member for McMillan’s fan club but, again, he addressed the issue not of exceptional circumstances but of ‘extraordinary’ circumstances. And they are extraordinary circumstances—not in every farm in Australia but in many areas. I would suggest that, where the creeks have not dried up for 60 years and they have now, it is a natural disaster, not drought. What we should be doing in this place in policy terms—rather than have this begging bowl mentality where we issue money to the farmers, make a press announcement and make them more depressed because they feel as though they are beggars—is put in place a natural disaster policy that in a sense is an insurance policy. Whether it applies to the Newcastle earthquake, whether it applies to the hailstorm in Sydney, whether it applies to a mudslide in Wollongong or whether it applies to a massive drought such as the one we are experiencing now, those events should be treated as natural disasters. It may be a Cyclone Larry or a Cyclone Tracy—those events should be treated as natural disasters and funds should be made available from a fund that everybody contributes to.

To simplify the issue, a dollar a week from every Australian would raise $1 billion in a year. If you look at the insurance records—and I am not sure whether or not this includes Cyclone Larry—since 1974 there has been one disaster that has cost more than $1 billion in the year, and that was the Newcastle earthquake. Normally it averages out—and it is not dissimilar to what is happening with this drought at the moment—at about $200 million a year. That is 20c a week from every Australian or 40c a week from every taxpayer.

So there is an easier way to go through this than the convoluted message where you create divisions between city people and country people and paint the picture that when the farmers are experiencing a drought they are being subsidised. The city people do not particularly like that and it is unfair treatment in some people’s eyes. If we created a national natural disaster fund, triggered by certain criteria, to assist people who were facing a disaster, rather than having the politics of blame and of playing the moment in the media when a disaster strikes, it would be a much better system than the one we have in place at the moment. It could be quite easily funded and could become some sort of national insurance scheme for disasters.

We have all seen insurance companies, when a flood occurs, arguing about whether the water fell down or the water came up. That has a significant influence on whether or not you get paid for the house and buildings you have just lost. If you have just lost your house and buildings, you really do not want to get into an argument about whether it was water falling on it or water rising up that caused the problem; you want some compassionate treatment. I think that in those sorts of circumstances you need a national insurance scheme. Whether they be city people or whether they be country people, if they are unlucky enough to be struck down by a natural disaster of some magnitude then there should be assistance for them.

The other issue raised today in terms of drought relates to the profitability of agriculture. Obviously, if you can lift profitability, you can lift the capacity of people to handle drought when it does come. There are a number of policy initiatives we should be having a close look at in this place. One is the renewable fuel debate. We still have not really addressed that issue. One of the impacts it can have is to lift the profitability of grain farming. It moves the income source from a purely food based market to an energy based market.

We have seen what has happened in parts of the United States with the lift in the corn price. We have seen what has happened to the canola price in Europe, and the pressures that puts on—and the benefits that that has for—Australian prices, even though we are almost nonplayers in the renewable fuels business. We have seen those impacts. We have seen the Brazilian ethanol industry’s impact on the global price of sugar, which has probably saved sugar communities on the Queensland coast. So there is a way of lifting the profitability of agriculture by looking at the ways in which we can enhance the income status of those involved.

The other issue I wish to raise—and the member for Hotham also raised it briefly—is climate change. What can agriculture gain from climate change that is not negative? I think there are a number of potential positives, so I was extremely disappointed that the Prime Minister did not include the farm sector in his carbon task force, for instance. If the storage of carbon in our soils through the accumulation of humus and organic matter can have a positive impact on the carbon dioxide in the air and on global warming, then maybe—through carbon trading et cetera—there is a way that agriculture can, again, lift its profitability if it can in fact store that carbon in soil.

One of the offsets is that, if you improve the humus and organic matter in our soils, you not only improve the capacity in terms of yield for our farm sector but also reduce the run-off and increase the infiltration rate and the microbial activity in the soil—you actually create a better soil. We talk about stewardship payments and all the other things that are talked about in the landcare movement and others. Why don’t we get to the basis of this problem? Where the pressure is coming on our soils, it is because the farmers of those soils are not as profitable as they would like to be and so the pressure is on their properties to produce income when the income producing times are on—and drought only exacerbates that. So I would encourage the government to look closely at that.

I do not know the answer, categorically, in terms of the capacity of our soils to absorb carbon. Obviously our better soils, such as those in the Darling Downs and Liverpool Plains—and probably even some soils in South Australia—may have the capacity to improve their organic matter and soil structure et cetera. But I think it is something that we should have a very close look at. Not only may it help those farmers in terms of their profitability, but also they may be part of the solution to the broader problem that has been caused partly by industrialised society.

In conclusion: obviously, I support the legislation. But I do think that, when we are passing these sorts of amendment bills, we should have a closer look at what we are trying to do with policy into the future. And I do not believe that, in the last decade or even in the last 15 years, we have progressed terribly far in terms of addressing drought through policy. If the number of 181 out of 17,000 small businesses that the member for Hotham suggested is correct—and I would ask the minister to reply to that tonight—that says to me that this policy is not working correctly. And that adds to the argument that the totality of the policy mix that we have been operating under for drought and other disasters is not helping the people who deserve that help. (Time expired)

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