Wilson Tuckey (O'Connor, Liberal Party) Share this | Hansard source

The previous speaker started to talk about the Commonwealth Finance Sector Union, and I thought it was appropriate—but I thank you for your guidance, Mr Deputy Speaker. It was just too good an opportunity to miss.

I would like to address a very significant issue in this omnibus legislation. Maybe some of these issues could have been dealt with independently. Investment in forestry managed investment schemes is a matter of longstanding interest to me. I served for three years as Minister for Forestry and Conservation and had the responsibility of implementing the 2020 Vision. I opposed it at all stages and I see the progress continuing in Western Australia: another section of native forest has closed down. That native forest has closed down because it has a component of old-growth forest in it.

We have competing arguments today. We have the problems of CO emissions and coal-fired power generators. We try and find a way through these problems. We are told that the growing of trees is a contributing factor to sequestration of carbon dioxide, which is the food of trees. Trees absorb it, keep the carbon and emit the oxygen. They are great recyclers of the atmosphere. Trees do that very efficiently until they get old and then, through the process of degeneration, they start to emit more carbon than they sequester. It is the same question. The people who advocated that we save the forests—significantly to let them burn down and create the associated emissions that nobody wants to talk about—are the same people who said we cannot have nuclear power. Now we are between a rock and a hard place: do we have coal-fired power, with its identified environmental problems, or do we have nuclear power? As you will be well aware, Mr Deputy Speaker, I promote tidal power because, with the huge resources of the Kimberley, it is the better alternative to both. It is disappointing that that does not seem to have much support on either side of this House. We locked up all our native forests for political reasons, particularly at the state level. Every election you could feel another forestry reserve coming on. It used to be a dam or some project of that nature. We gave up on all those and now we are short of water.

Consequently, as that native timber resource dried up, we found ourselves with an ever-increasing trade deficit in forest products—in particular, paper, the consumption of which is huge. We were not allowed to cut down the native forests, and we did not have any other forests at the time. Consequently, in sawn timber and paper products, we closed our eyes to the rape of the rainforests of Asia—Indonesia and other places. We also closed our eyes to the fact that, when green interests tried to prevent the retailing of sawn rainforest timber, we accelerated the destruction of those rainforests—because, once the trees no longer had an economic worth, they were all knocked down and palm trees were planted to produce palm oil. Peculiarly enough, no-one ever pickets our fast-food outlets that use that product.

The outcome of all that was that our government had to come up with a policy to redress the $2 billion trade deficit and achieve some sequestration of carbon from healthy young trees—while the old ones that we were protecting were emitting more carbon dioxide than they were absorbing. We generated the 2020 Vision. At that time you could have tax deductions under what was known as the 13-month rule, a longstanding component of tax law that applied to agricultural activity. That meant you could invest money in the last half of one financial year and, if it was expended during the 12 months of the next financial year, you could get a deduction for your expenditure in that first month when you actually spent the money. That has attracted a huge investment in the growing of trees. In my electorate, that has materialised into an industry. I visited Albany the other day and saw the naming of a brand-new, purpose-built 60,000-tonne vessel that has been built by Japanese interests just to transport from Albany, in the southern end of my electorate, to Japan woodchips from trees that are only eight or 10 years old. Of course, these are the creme de la creme of woodchips. One of the disadvantages of chipping in old-growth forests was that the product was not as attractive to paper manufacturers as these new products are. So we have fixed that up.

With the last piece of legislation—on which I had significant negotiations with the Assistant Treasurer because there had been some changes made which put this program at risk—a sunset clause was pasted to those arrangements, which virtually reinstated the 13-month rule. That means we now have to revisit that legislation. The legislation is quite simple and sensible. In fact, it adds another reform which says that there has to be at least 70 per cent of direct forest expenditure taken from the investor’s funds—and that was fine. But the real fact of life is that that applies only to forestry.

This investment program has developed all sorts of other opportunities. The government has decided—and I do not necessarily agree with it—that these other developments, such as olives, almonds and fruit trees, would have been better left as they were, under similar arrangements. But, no, we have created total disarray by saying that we will let the courts sort out where in the system they lie. I think we should have made it certain—even if in a negative sense. I think the amount of prosperity that that sort of investment has delivered throughout the rural areas of Australia was well worth the taxes that might have been temporarily lost—and, when you sort through them, I am not sure they were as large as people thought.

The greatest problem I have is that some young men in Western Australia have commenced a new MIS whereby the investor purchases rights to the sowing of a crop—and, of course, rights in percentage terms to a share of the profit. The interesting thing is that, in parts of the Kalgoorlie electorate, growers had no rain at all this year. In the absence of rain, they did not take their machinery out to the paddock. But that was a loss that the investors, the cashed-up people from the city, had to carry. Actually, the manager of these funds sent cheques to growers who, because there was no rain, never took their tractors out of the shed—and they have been living on that money in the absence of any return from cropping. That is part of the scheme. The investor takes that level of risk, just as farmers have done for centuries. Farmers in my electorate are now discovering that they want to be part of the investor base as well as being one of those who receive investments. They reinvest some of the money they have received from a cashed-up city investor so that they have geographical cover; if it is raining in one part of the electorate and not another, they still have the opportunity to have cash flow.

That scheme has been left out of these provisions. I sent to the minister a copy of an amendment that might have been included here. I am disappointed that it has not been included, because it is virtually multi-peril crop insurance provided by the private sector. I believe it stands in a different segment from investments in other agricultural activities, which are to be resolved in court. There is a possibility that next year the scheme will fall over, when in fact there have been huge benefits for people. Just today we were discussing how people who have now had some rain can find some cash to sow a crop. They should contact AACL and participate in this scheme, because they will get the cash. Let us hope they have a significant crop and share some of the profits. That is fair enough. But at least they will be back in business. It is a pity that this scheme is not mentioned today. (Time expired)

Debate interrupted.

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