Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Hansard source

It is always great to follow on from the member for Grey, from South Australia. He understands the importance of the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015 and related bills. He knows that, in the lead-up to the 2013 federal election, in which he was successful in his seat, the coalition announced that it would be lowering the screening thresholds for foreign investment in agricultural land and agribusinesses and establishing a register of foreign ownership of farmland in Australia.

I am not surprised that the speakers' list for Labor has been exhausted. They are a bit embarrassed about this legislation. They have never been supportive of lowering thresholds. In fact, I well recall that, when foreign ownership was being discussed in the 43rd Parliament, Labor increased the threshold for farmland and agribusiness from $248 million to $252 million, which is where it sits now. That is far too high. I always argue that you could just about buy every farm in the Riverina for $248 million, let alone whacking another $4 million on top of that. It was just ridiculous.

In speaking to this legislation, I intend to provide a snapshot of a couple of towns within the Riverina. In this speech, I also intend to quote from an excellent article that the Australian Farm Institute published in February 2014.

This is important legislation. On 2 May 2015, the government announced changes to strengthen the integrity of the foreign investment framework. These measures included enforcement of the existing foreign investment rules by transferring the residential real estate functions to the Australian Taxation Office; and utilising sophisticated data matching systems and specialised staff with compliance expertise—and that is important, because we cannot have first homebuyers, or any homebuyers, being squeezed out of the market due to prices going up too high from foreigners coming in and buying off the plan.

Stricter penalties to make it easier to pursue foreign investors who breached the rules are also a part of the framework of this legislation. The existing criminal penalties will be increased from $90,000 to $135,000 for individuals, and divestment orders will be supplemented by civil pecuniary penalties and infringement notices for less serious breaches of the residential real estate rules. Third parties who knowingly aid a foreign investor to breach the rules will also now be subject to civil and criminal penalties, as they should.

Importantly, with agricultural land, from 1 March this year the screening threshold for farmland was lowered from $252 million to $15 million, and that is cumulative. So you cannot buy a farm and then the farm next door and then the farm next door to that. Once it reaches $15 million, that is it. It will trigger a notice to the Foreign Investment Review Board, who will obviously look into it.

From 1 December 2015, a $55 million threshold, based on the value of the investment, for direct interests in Australian agribusinesses will be introduced. We have a good record in this space. I know when Archer Daniels Midland wanted to take over GrainCorp in 2013 that caused a huge amount of consternation in my wheat belt electorate of the Riverina. My father and his father before him had virtually paid for the silos and they felt, as did many other farmers, that they had also put a good investment down on the rail lines going to those silos. They questioned why an American company with, might I say, not the greatest corporate record, was able to come in and just absolutely take over. In that case, our farmers would have been left with their grain price being determined by a boardroom in Illinois, by Americans who would care not for how much wheat was grown in Australia or for the price that was going to be paid to our great Australian farmers.

Increased transparency on the level of foreign ownership in Australia through a comprehensive land register is also part of this legislation. An agricultural land register with information provided directly to the ATO by investors was established from 1 July this year. The government is in negotiations with states and territories to use their land titles data to expand the register to include all land, including residential real estate. Queensland is one state which actually has good records but, unfortunately, other states do not keep as good a record as they should. Comprehensive modernisation of the foreign investment legislation to reduce system complexity and compliance costs for investors is also part of this legislation.

For those listening, I will just give a snapshot of a couple of good rural towns within my electorate—the first being Temora shire, the mayor of which is Councillor Rick Firman OAM. The agricultural production in Temora shire to the financial year ending 2011—so these figures are a little out of date—was worth $181.4 million. Crops were worth $141 million; livestock slaughtered and other disposals, $27.8 million; and livestock products, $12.6 million. They are big numbers. That is just one of the towns of the 13 local government areas I represent.

Leeton Shire Council, the mayor of which is Councillor Paul Maytom, is going very, very nicely. In 2012-13, the gross value of agricultural production in the Riverina region was $2 billion. In Leeton, they did particularly well, helped by the establishment of a bulk agribusiness industrial park and intermodal facility at Wumbulgal, 30 kilometres west of Leeton. Capital investment on site over the next two years includes $40 million confirmed with another $42 million potential. This would translate to 586 jobs during construction and 146 full-time equivalents during the steady rate. This investment will remove over 34,000 vehicle movements onto rail.

The establishment of Walnuts Australia processing facility 10 kilometres north of Leeton at $4.2 million combined with 700 hectares of walnut trees represents a new industry to the shire worth $12 million. Walnuts Australia employs 55 staff in peak seasonal times and has a strong export focus.

Award-winning Southern Cotton is a $20 million investment by a group of farmers who continue to improve efficiencies and operations at the Whitton cotton gin. The gin processes 200,000 bales—that was the 2015 season—employs 52 staff at peak season and supports the trucking industry, farmers and agronomic services. It is not just the actual site, facility or the plant with all of these establishments; it is all the direct and indirect benefits that it brings to not just the particular shires like Temora or Leeton but the whole Riverina, the whole state and indeed the nation. This legislation is so important, because these agribusinesses cannot and should not be just taken over willy-nilly by a foreign investor without the Foreign Investment Review Board, the government and the Treasurer of the day having a say in it.

JBS Swift continued investment improvement at Riverina Beef in Yanco's premium product has recently yielded gold and silver medals as well as overall champion in the grain fed class at the Sydney Royal Fine Food Show Branded Beef Awards. The company's flagship, Riverina Angus, was awarded gold. They are going very nicely. They are a good company that took over from a Japanese company, and I appreciate that that is foreign owned, but they are bringing benefits and jobs to Leeton Shire and to the wider Riverina. They bought the place the right way. They bought the place, kept those jobs going and then increased the number of cattle from a few thousand to upwards of 55,000 head. The Wagyu breed is just about to go into that facility, and the first kills are expected in coming weeks.

Look at freight in Leeton. Annual yearly containers exported from Leeton number 18,000 20-foot-equivalent units. That is remarkable. Inbound and outbound containers to and from Leeton per year are 36,000 TEU. They are big numbers, and that is why we need to ensure that we protect at every opportunity that agriculture and those farmers to make sure that we do not have foreign investors coming in, buying up huge tracts of land, knocking down the fences and wiping out all the family farms that have made the Riverina great.

I quote from the February 2014 article in the Australian Farm Institute publication. It said:

Australia is selling off the farm to foreign investors, and won’t be able to feed itself in 20 years.

That is pretty damning. That is a pretty stark sentence. It says:

While anyone with a reasonable knowledge of Australian agriculture would immediately dismiss a statement such as this as pure fantasy, there has been plenty of media stories running these lines over the past 12 months, and it is an issue of increasing concern to voters. In fact a recent Essential Report (2013) survey found that 55% of Australians are opposed to the sale of Australian farm land to foreign investors, and only 22% are in favour, with the rest undecided.

The article examined the role of foreign investment in Australian agriculture and talked about some of the issues which were creating unease amongst people—not just people, I have to say, in country areas but, indeed, people in city areas as well. I hasten to add that I sometimes think that people in metropolitan areas—certainly the Greens—have no concept. I should say little concept in the case of some and absolutely no concept when it comes to the Greens for what goes on outside the bright city lights of Melbourne, Sydney and Brisbane. That is why this Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015 is so crucial.

It is not just perception. The Farm Institute article talked about the fact that we would not be able to feed ourselves in 20 years, because the farmland would have been bought up, our markets would be dictated to by foreign boardrooms and, quite frankly, we would have very few farmers left. But this legislation prevents that. This legislation stops that and will bring some comfort and certainty to the many people who do get concerned when there are reports that our real estate agents are out in Asia, the Americas and Europe selling up all the farmland. This legislation will bring the $252 million for farmland back to $15 million cumulative and $252 million back to $55 million for agribusiness.

The member for Hunter is not in favour of this legislation. He has never been in favour of it and calls xenophobic the fact that we are introducing this legislation to the parliament. He is more in favour of there being a $1 billion threshold. I heard him, as the member for New England, the Minister for Agriculture, was talking about this particular legislation and other topics earlier today, just haranguing him over the desk, criticising him at every step of the way—totally unnecessary.

The people of Australia know that the sensible people are in charge of this government, and we showed that this week when there was a prime ministerial change. The Nationals got on board with a very good suite of measures that are going to benefit regional Australians. This particular legislation before you was something that the National Party fought hard for and introduced through the proper cabinet processes. That is why it is on the table here today. That is why we are debating it. The suite of measures that we have been able to negotiate with the new Prime Minister, the member for Wentworth, this week will see very important programs rolled out for regional Australians, for stay-at-home parents and for regional mobile phone black spots. They are good policies.

Of course, there is also moving water from the environment portfolio into agriculture, and that is so very important because we need the elixir of life to be able to grow all the food and fibre that I talked about earlier. We need our farmers—Australian farmers—to have the safety, security and knowledge that their farmland will be protected for them and for the generations to follow. It will be farmable by Australians with water in the agriculture portfolio because the Nationals along with the Liberals understand how important regional Australia is, understand how important agriculture is and understand that there is a very bright future for farming in this country.

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