Bob Katter (Kennedy, Independent) Share this | Hansard source

It is a matter for clarification as far as the parliament is concerned. In any event, I do not think that the subject matter we are talking about here would be a matter for frivolity. These related industries are far more vulnerable than the industry itself. In the cane industry, a cane farmer in the areas which I represent, which is probably about 40 per cent of the Australian cane industry—a very big industry; probably $1,000 million worth a year would be produced there—can sell out to lifestylers or to timber people who are advocating that you will not pay as much tax if you invest with them. There are a number of alternatives available to a cane farmer. He can switch to small crops. He can put lychees in. He has a number of other options, such as cattle fattening, open to him.

But a cane harvester often has more money—an awful lot of cane harvesters I know have two or three harvesters at half a million dollars a piece—invested in the industry than the cane farmer. If sugar continues on its downward spiral and the government does not come to its senses with respect to ethanol, then we have got very grim days ahead of us. But it is much less grim for the cane farmer than it is for the cane harvester. As I said, there are a number of alternatives open to the cane farmer. He can diversify, but a cane harvester cannot. What do you do with a cane harvester if you have got no cane to harvest? You indeed are up the creek without the paddle!

In cattle, for example, we have the livestock hauliers. Whilst their prime movers are marketable, the trailers are really not very suitable for anything else and to modify them so that they would be useful for other purposes is not practical. Again, here is an industry that is related to cattle but one that would be far more badly hurt by a drought or flood or the various other exceptional circumstances criteria than the farmer himself. So we applaud the government for the big moves that are being made here, but we seek some clarification on some of the details. We would strongly urge the government to reconsider, if there is a cut-off point in 2008, removing that provision.

Having said those things, we have to put this into the bigger perspective. When I say ‘industries’, people immediately imagine a man on a horse or a man on a tractor, but the vast bulk of the employment in most agricultural industries is in the support industries whether it be livestock hauliers, fencing contractors or mustering contractors, the helicopter owners or the people that sell supplementary feed in the cattle industry. In the cane industry, similarly, there are miles of ancillary industries depending upon the farmer for their existence.

What these industries require, whether they be the farmers themselves or the backup downstream industries and service businesses, are two things. Like everyone, they require a fair go—a level playing field. What this government has done—and far more culpable was the Keating government before it; but this government is equally culpable—is that it has not delivered a level playing field. In fact, it took our level playing field away from us. The last time I looked, the average tariff level for OECD countries was 49 per cent. The same figure for Australia was six per cent, most of which comprised the dairy levy and the sugar levy, both of which are being phased out—they may have even been phased out at the time I am speaking of. So a fair figure for Australia would be about 3.5 per cent or four per cent. We do not have a level playing field; we have our competitors up there running 100 metres with a 30-metre start, and we are expected to catch them. Our government has deprived us of the right to have a level playing field, whether that government was the Paul Keating government or the current government. I am deeply disappointed that there has been absolutely no attempt by the members of the government of Australia or the people that represent rural Australia to bang home this point to their own government. I would find it very difficult to find a single speech in this House that draws attention to the fact that while they preach level playing fields they in fact have put us on the most unlevel of playing fields.

The second thing required desperately by the rural industries—and I am talking about broadacre farming and the drought, but also flooding because sugar can be argued to be a broadacre crop and it is subject to flooding, which comes under exceptional circumstances, or did last time I looked—is assistance from government in the financial markets. All our rural industries that are competing on the world market are by their very nature cyclical. The price goes up and the price goes down. If you look at long-term prices in the wool industry, prior to the intervention by Doug Anthony with the buying scheme, and even afterwards, you will see that they are cyclical. The cycle is on a much higher level than the cycle was before the introduction of statutory marketing in the wool industry. It is similar in the wheat industry, the cane industry and the cattle industry.

But in those down cycles the banks panic. Australian banks are not very enlightened. They do not take a long-term view. The major banks have given up about 40 per cent of the market and they are desperately trying to win it back. When I was driving from the airport in Townsville back to Charters Towers, it was very funny to see a huge sign up there from one of the major banks—I think it was Westpac—effectively saying, ‘We love farmers; we want you to do business with us.’ Well, they closed all their rural branches, they lost all their expertise in this area, they did not want to know us, they sold us up and let Rabobank come in and take all of that ground from under them. Rabobank is now one of the major rural banks in Australia. Elders, the QIDC Bank and the rising and aggressive Bendigo Bank have taken a huge swathe of the rural markets from the mainstream banks because they have no enlightenment, no long-term view and no great or significant understanding of the industries that they are dealing with.

Let me be very specific: during the downturn in the cattle industry which was coupled with the drought in the late 1980s and early 1990s, our interest rates went to 23 per cent. That was the normal and almost universal interest rate in the cattle industry throughout that period. We were penalised because we were an at risk industry, which added 2.5 per cent to the 17 per cent interest rate regime of Mr Keating, the world’s greatest treasurer. He let all his supporters run away with thousands of millions of dollars playing monopoly games with each other whereas the Australian people had to pay 17 per cent interest rates to rescue the mainstream banks that had been so frivolous with their money. Whilst that figure was 17 per cent for Australia, we were hit with a penalty rate of 2.5 per cent because we were in an at risk industry. Then we were hit with another 2.5 per cent on top of that because we were in an at risk area which was suffering drought at the time. So another 2.5 per cent got piled on. Then, normally another one per cent went on in bank charges, because they wanted to oversight us. They put all sorts of charges on us—they had to pay three valuers to come out and look at our place, they had to review it, they had to do an inspection and they had to get a consultant in to give them another report on how we were going to get out of our troubles. I speak with great conviction and knowledge because we in fact paid 29 per cent in 1989, I think it was. That was the figure with bank charges that we paid in that year.

There have been enlightened governments in this country: Theodore and McEwen were the dominating figures in Australian history in the last century. I think all the history books tend to agree on the very great influence of Theodore that was carried on with Curtin and Chifley after he was gone. Those people said that we needed development banks. They used the words ‘development banks’, and they were not bad words to use. What happened was that when you got into the sort of situation that the cattle industry was in at the end of the eighties then you would go to this bank and it would ensure that at least you were paying only 17 per cent ordinary interest rates instead of penalty interest rates.

I speak again with very great conviction because I was one of the two ministers charged with the responsibility of the state bank in Queensland, which was called the QIDC. I received much criticism when the QIDC was switched over to a formal bank, as many in this place were quite aware of the prominent position that I held at the time. I will not use his name or be specific but the chairman of the bank at the time informed me that a third of the sugar industry would have to go. This was during a downturn in the sugar industry in the mid-eighties. I tried to explain to him that the industry was cyclical. We were at a function and I said, ‘No, I’ll come tomorrow,’ and the next day I brought to him the cycle of prices in the sugar industry and I showed it to him.

He explained to me as if I were a simpleton and a person that did not know anything about anything of importance that it was beet sugar from Europe that was crashing the world market. I informed the chairman that beet sugar had crashed the Australian sugar industry in 1898. It was not a new phenomenon for us to live with. We had lived with it for 100 years and it was not to be taken into account. I said: ‘We are at the bottom or maybe halfway down a down cycle—who knows, but we are not going to kiss goodbye to a third of this industry when we know we have a cycle here and we know that, with a proper government approach to this matter, it will recover.’ People said, ‘You did this to subsidise.’ No, we made huge profits in the QIDC. We went from a little bank of $250 million to a giant bank of nearly $4,000 million in a very short space of time. I think we are talking about nine or 10 years.

We people in rural Queensland will never forget that it was the National Party government, the Borbidge government, that sold that bank out from under us—we will not forget that. It was put in place to rescue those people. We brought almost every single sugarcane farmer through that period. If we had listened to this man we would have let a third of the industry go, but then, not eight months later, the price of sugar doubled because there was a cycle and it just happened to be a shorter cycle than normal.

We had the resources and the accumulated knowledge of government behind us when we made that decision. This man had come from the financial accounting industry and he had a towering ignorance of the subject he was dealing with but he would not be advised or listen to anyone; he was going to make his own decision. We had to ask him to stand down. It was a very controversial decision by the government. If we had not done that a third of those hardworking cane farmers—almost every one of them who had cut cane by hand as young men—would have vanished. Thousands of mill workers and downstream people that depended upon this industry, the people we are talking about today, would have been utterly distraught.

The greatly enlightened men of Australia, Mr Theodore and Mr McEwen introduced the Commonwealth Development Bank and the AIDC. Bjelke-Petersen introduced the QIDC in Queensland and the Rural Reconstruction Board. There were five different organisations that we could go to for help to get us through these periods. That is one of the reasons that the accumulated wisdom that a farmer has is so important. As one of my great friends in the citrus industry said: ‘People say I’m making a lot of money today as a grape farmer. What they forget is that it took me 15 years to become a grape farmer.’

In farming sometimes it might take you two or three generations. The station property I own never had cattle on it because no-one knew how to handle that country. But through the accumulated wisdom of three generations and some very good people who worked in agricultural science for the state government—they do not exist anymore; they have been wiped out by the current state government in Queensland—thanks to those people, we found out how we could run cattle and run them prosperously in that country. Because there is water everywhere there, there is lot more wildlife there now than in days past. Terrible fires went through there. In our second year on St Francis, fire broke out on the place next door and went for 800 kilometres. It took out every single tree for 800 kilometres. If you flew over it, you would see the imprint of the tree because there was ash on the ground that was a dark fawn in colour. But now man is there and there are firebreaks so that the terrible calamities that happened in the past cannot happen in the future. We have made this Australia that we live in a much better place.

As for it being the worst drought, Australians do not read the history books. It is a terrible shortcoming in this country that we have the shortest of knowledge time spans. From about 1884 through to 1914 it hardly rained in Australia. They called it the Federation drought but it actually started in 1884. Whilst there were some good years in there, it hardly rained at all. The spawning of the Labor Party came out of that because the cockies were broke and they demanded that they pay less to the shearers. The shearers got their backs up, they went on wild strikes and then there was violence in Queensland. There were 2,000 troops that were moved into western Queensland and the entire state executive of the AWU was jailed. I think 13 of them in the Rockhampton branch of the AWU got three years hard labour for going on strikes. There were woolsheds burned all over the place, people were shot and tied to railway lines. Out of that great violence was born the great labour movement which did a lot of wonderful things for this country, and I do not hesitate to say that. Some 26 million sheep died in a period of three or four years during that time. It is fraught with these things but the great instruments that the Theodores, the McEwens and the Bjelke-Petersens gave us in the state banks that helped us in these situations have been removed. (Time expired)

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