Mr Tony Burke (Watson, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Hansard source

by leave—Labor governments have a proud history of improving Australia’s agriculture policy to support our farmers and underpin economic growth. Under the Hawke and Keating Labor governments, significant agriculture policy reforms were introduced, many of which have enjoyed bipartisan support over the years including:

• Establishing the Rural Research and Development Corporations.
• Creating Landcare, an internationally acclaimed partnership between farmers and the environmental movement.
• And, of course, introducing ‘exceptional circumstances’ policy to help farmers and their families in times of extreme drought.

Labor has consistently faced the challenges of rural policy reform. That has continued under the Rudd government with the introduction of the Caring for our Country and Australia’s Farming Future programs and again yesterday when the Wheat Export Marketing Bill was passed in this House. The government recognises, however, that there is now more work to do.

The farm community now widely acknowledges that climate change is the greatest challenge facing rural Australia. Climate change is the greatest challenge facing rural Australia. It is a major challenge for rural communities, farm businesses and policymakers, particularly in the area of drought policy.

Labor has long recognised that, despite the best efforts of farmers to prepare for periods of low rainfall, severe droughts have a serious impact on the livelihood of rural Australia. Labor’s early drought policy reforms recognised for the first time a key principle that has since been supported by all sides of politics—that is, despite farmers’ efforts to prepare for drought, no-one could have predicted the severity of the drought we are now facing. Indeed, that is what is meant when we refer to ‘exceptional circumstances’.

Exceptional circumstances policy was underpinned by a number of key principles including:

• encouraging primary producers and other sections of rural Australia to adopt self-reliant approaches to managing climate variability;
• maintaining and protecting Australia’s agricultural and environmental resource base during periods of climate stress; and
• helping agricultural industries return quickly to levels of production which are sustainable in the long term.

To deliver these objectives, early drought policy was based on a number of key elements including:

• exceptional circumstances (EC) declared areas to define those areas in need;
• EC business assistance grants and interest rate subsidies to help farmers sustain their livelihoods in times of drought;
• financial planning programs for farmers and rural communities;
• drought relief payments to help families struggling due to drought; and
• the Income Equalisation Deposit Scheme, a precursor to the Farm Management Deposit Scheme, to help the benefits of the good years stretch into drought years.

In opposition, Labor gave broad support to changes to drought assistance introduced under the previous government. It is now widely acknowledged that the current drought has been significantly worse than when EC was originally conceived in 1992. The early drought policy was initially based on a model of a one in 20 to 25 year event. For example, at the time, it was not envisaged that a situation would arise when irrigators were unable to access water, as is currently the case. Furthermore, it was never conceived that some areas of the country would be in drought for eight consecutive years, as is the case in some parts of Australia today.

These facts have raised questions in the minds of all Australians, including rural Australians, about the link between climate change and drought. The band of climate variation is shifting. In recent years, these questions have been confirmed by a growing body of credible science. Recently, both CSIRO and the Australian Bureau of Meteorology have explicitly recognised the link between the current drought and human induced climate change. Against this background, the government believes that it is time for Australia’s farming community and rural policy makers to reconsider the meaning of EC for the future. By undertaking reform to drought policy now, we can help farmers to adapt and respond to climate change, as well as develop closer links between the objectives of drought policy and the challenges of climate change.

There is now an urgent need to start planning for a future likely to be characterised by:

• reduced water availability;
• increased frequency of extreme weather events such as flooding, drought and cyclones;
• increased frequency and intensity of fire;
• altered distribution and survival of pests, weeds and disease; and
• increased risk of heat stress for intensively housed animals.

That is why the government has announced a major review of drought policy. There are a number of critical areas where it is clear there is a need for new thinking in relation to drought policy. For example, it is now clear that climate change means we will need to re-examine the early model of a one in 20 to 25 year drought. Despite all the different views about the pace of climate change, there is agreement on one thing. I do not think anyone believes that, when this drought breaks, we will be waiting 25 years for the next one. If we change nothing, farmers in the future will miss out when the one in 20 to 25 year test is applied.

Another area of concern that many farmers have raised with me is the issue of lines on a map. This is one of the critical elements of early drought policy which the government believes needs careful consideration. With the benefit of time and experience, both sides of the House would probably now agree that creating distinct geographical regions within which a drought event is declared has its own challenges and difficulties. During my travels across the nation over the past six months, many farmers have made it clear to me that the lines on the map are unable to distinguish accurately those farmers in need. The current system allows neighbouring farms with identical needs to see one farm receiving assistance while the neighbouring farm receives nothing. We can do better.

It is now clear, with the benefit of hindsight, that this model needs closer examination. There is certainly widespread support from the farm community about the need to review drought policy. As the President of the National Farmers Federation, Mr David Crombie, has said, and I quote:

While the Government must continue to address the ‘here and now’ of drought through Exceptional Circumstances as the first priority, equally, we must cast an eye to the future.

That demands a new cooperative partnership between government and farmers to invest and work together to better drought-proof Australia and, ultimately, shift the policy focus from ‘drought relief’ to ‘drought management and preparedness’.

That is why, on 19 June, after extensive consultation with my state colleagues, I was pleased to publicly release the terms of reference for three separate investigations which form the national review of drought policy. I table the terms of reference for those reviews.

The three parts of the reviews are:

• firstly, a climatic assessment by the Bureau of Meteorology and the CSIRO;
• secondly, an assessment of the social impacts of drought by an expert panel; and
• thirdly, an economic assessment by the Productivity Commission.

The assessment being conducted by the Bureau of Meteorology and the CSIRO will provide underpinning evidence on the effect of climate change on the nature and frequency of exceptional climatic events. This scientific assessment will comment on the appropriateness of the current one in 20 to 25 year exceptional circumstances event trigger, based on the historical record, and will identify information needs and areas that require more detailed assessments. I expect to receive the Bureau of Meteorology and CSIRO report in the next month.

I recently announced the members of the expert panel to conduct an assessment of the social impacts of drought, which will be chaired by Peter Kenny, who is a cattle producer from Queensland and is President of Agforce Queensland and board member of the National Farmers Federation.

Other members of the panel include:

• Sabina Knight, an academic and expert in remote area health;
• Mal Peters, principal of a family farming enterprise in northern NSW, board member of the Australian Farm Institute and a former President of NSW Farmers Association;
• Professor Daniela Stehlik, Foundation Chair in Stronger Communities at the Curtin University of Technology;
• Barry Wakelin, the former member for the electorate of Grey, and a former Chairman of the Standing Committee on Aboriginal and Torres Strait Islander Affairs;
• Sue West, the chair of Anglicare Western NSW and a former senator; and
• Lesley Young, National President, Country Women’s Association of Australia, who is also a mixed farming operator in Tasmania and a former Chairman, Rural Financial Counselling Service Tasmania.

The panel will visit rural communities to hear first-hand how the drought has affected them.

The work done by the Productivity Commission will look into the appropriateness, effectiveness and efficiency of current Commonwealth, state and territory government drought business and income support measures. It will also examine the most appropriate measures to build self-reliance and preparedness to manage drought. As part of the inquiry the commission will release a paper on the issues surrounding drought and the impact on rural and regional communities. The commission will call for public submissions and conduct hearings across rural and regional areas of Australia.

Following extensive consultation, the commission will publicly release a draft report by the end of October this year. This will ensure it will examine all of the issues surrounding drought and that its impacts are considered. The commission will provide the government with a final report by the end of February next year.

These assessments, taken together, are a crucial step forward in the government’s efforts to ensure drought policy meets the future needs of our farmers in a changing climate. The Rudd government is determined to support our farmers to build even more competitive, productive agricultural industries. The drought policy review will complement other initiatives such as the $130 million Australia’s Farming Future package, which will increase on-farm preparedness, boost research and provide more professional advice and training to primary producers.

I want to stress that the Productivity Commission’s inquiry and the expert social panel’s assessment include comprehensive public consultation processes. The government does not have a predetermined outcome in mind except that the overriding policy objective of the government is to better prepare farmers for climate change. It is important to reiterate that the review will not affect anyone receiving assistance in a current EC declared area. This review is about preparing for the next drought.

Equally important to note is that the National Rural Advisory Council’s reviews of expiring EC declarations are not related to the review of drought policy and will proceed independently. The membership of NRAC remains the same as under the previous government and their assessment and recommendation tasks remain the same as under the previous government.

The government also recognises that some farmers coming out of EC drought declarations still require further income support. That is why, on budget night, the government announced a new program—the transitional income support program. TIS has been introduced to assist farm families who are in serious financial difficulty or who are recovering from drought, while they adapt to changing circumstances, including climate change. TIS is not a replacement for EC relief payments. The program is available to farmers coming out of EC declarations who still may find it difficult to put food on the table. It is also available to any farmer in any area who is in serious financial difficulty.

TIS has eligibility tests in line with other social security income support payments to ensure that those seeking financial assistance from the taxpayer must first draw on their own reserves. Farmers will need to meet a liquid assets test and farm business net assets test which has been benchmarked with other social security payments and set in line with the net assets level of low-income farmers.

Transitional income support will be available for up to 12 months from 16 June 2008 until 30 June 2009. Any assistance after that date with respect to TIS will be considered in context of the drought policy review. Transitional income support will have a climate change focus and strengthened eligibility criteria, and farmers will be obliged to take action to achieve self-reliance. Rural financial counsellors will assist farmers to plan for the future and take action to improve their long-term financial position.

The Rudd Labor government is helping farmers prepare for the future, a future in which the greatest challenge they will face is the challenge of climate change. The Australian climate has always been challenging for people working the land, and Australia’s farmers have proven to be adept at responding to our harsh climate. I believe Australian farmers can and will adapt to the challenge of climate change. The Australian government stands ready to assist them with this challenge.

I seek leave to move a motion in relation to the debate.

Leave granted.

I move:

That so much of the standing orders be suspended as would prevent Mr Truss (Leader of the Nationals) speaking for a period not exceeding 15 minutes.

Question agreed to.

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