Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Minister for Agriculture and Resources) Share this | Hansard source

I can see that it might seem a bit of an overreach at first blush to say that in Australia we are at serious risk of losing our dairy industry but, sadly, that is true. For those who doubt it, I refer them to the most recent figures, which indicate that in the last decade we've lost around 35 per cent of our dairy farms. That rate of departure has accelerated in recent years as dairy farmers find themselves more and more in the middle of a price squeeze. Costs are rising, now exacerbated by drought, and, of course, prices at the farm gate are stubbornly staying very low, sometimes below cost. As hesitant as I am to say it, we are at real risk now of having to import most of our dairy products and, I fear, even some, if not all, of our drinking milk. That would be a disaster for this great Australian agricultural sector.

I just saw the Minister for Water Resources, Drought, Rural Finance, Natural Disaster and Emergency Management shaking his head. He does need to shake his head, not at what I'm saying but rather at what his government is not doing. I have some very genuine sympathy for the minister for drought. I thought that when he was the agriculture minister he didn't make a bad fist of it. He'd begun to tidy up the very significant mess left by the former minister, the member for New England. Just as importantly, he was creeping away from what I call National Party fundamentalism. You might call it National Party economics. He was trying, at least, to take his party away. He did respond, although not as extensively as we would have liked, to the live sheep trade, for example. I know that caused him a lot of grief internally, but at least he had a bit of a crack at it; he had a bit of a go. Sadly, as a result the rug was pulled out from under him, and the National Party made it very clear to the Prime Minister that they would not have the member for Maranoa as the agriculture minister. To his credit, the Prime Minister said: 'Well, I'm not cutting him loose entirely because he does understand the problem with National Party fundamentalism. I'll create a new role for him as the drought minister so I can leave him in that space.' The minister should acknowledge that I'm trying to extend to him a compliment.

Now we've got Minister McKenzie, and I ask my colleagues to think about it for a moment and ask themselves to name one thing that Minister McKenzie has done for the agricultural sector in her six months in office. Of course, the silence is deafening because the answer is absolutely nil. This is the minister who told her party room that the dairy sector couldn't have a code of conduct until July of next year but told the National Party they could have one by Christmas this year, such is the incompetence she demonstrates both in her party room and in this parliament.

But the real problems in the dairy sector, as we know it today—notwithstanding the fact that there have been significant challenges since deregulation under former Prime Minister Howard back in 2000—began in April 2016 with the collapse of Murray Goulburn. That event reverberated through the dairy industry extensively. It began with Murray Goulburn farmers, it moved quickly to Fonterra farmers axiomatically and then it caused damage and chaos right across the dairy industry. What were the government's response to the collapse of Murray Goulburn? They could have intervened. When Murray Goulburn went to its farmers and retrospectively cut their farmgate prices without notice, the government could have acted. In fact, at the time, we appealed to the government to act, and there was an opportunity for the government to act and to call upon the Murray Goulburn board to use the powers available to it under the profit-sharing mechanism to deny the Collins Street investors their returns and to leave the dairy farmers alone.

If the government had joined us then in calling upon the Murray Goulburn board to do so, surely they would have had no choice. The pressure not only in the community but in this place—and I know we would have been supported by the member for Kennedy—would have been so overwhelming they would have had no choice. But no, the government failed to act. What was their response? They commissioned an ACCC inquiry. You know how it works on that side: when all else fails, have an inquiry. We don't have any problem with ACCC inquiries. In fact, I have a high regard for the ACCC. It doesn't always get it right, but it is a fair organisation and it does its best. It has some very good people. What did the ACCC recommend? Its only really substantive recommendation, after an 18-month-long inquiry, was a mandatory code of conduct for the dairy industry—something we on this side of the parliament have been committed to for at least three years.

So there wasn't any political interference. There is nothing stopping this government from introducing a mandatory code of conduct for the dairy industry. In fact, they did it for the sugar industry literally overnight, in 24 hours. When the now Prime Minister was Treasurer, he introduced a mandatory code of conduct for the sugar industry in 24 hours. But here we are, 20 months on from the recommendation from ACCC on the dairy industry, and we don't even have a final draft of a code because those who sit opposite can't even agree on what it should look like. It is time they acted. Our dairy farmers should not have to wait until July next year.

The last parliament is behind us. Those opposite made some terrible errors. They abandoned our dairy farmers. But it is a new parliament, and I call upon them to now work with us on a bipartisan basis to act, if belatedly. We are not off to a good start. The last week we were here we gave them an opportunity again in the Senate to back a minimum farmgate milk price for our dairy farmers—a guaranteed price so farmers can rely upon at least cutting even when the processor comes shopping. Again, National Party aligned LNP senators sat on the other side and voted against dairy farmers—again, that is behind us.

It's not too late, Minister, and this is what we need to do: we need to get that mandatory code of conduct, the right code of conduct, in place immediately. We need to embrace a minimum farmgate milk price, set by an independent regulator, just above the average cost of producing a litre of milk in each dairy industry. This is not Hanson economics; this is common sense. I heard one of them say, 'What about our export industry?' I say again that, if we have to pay our dairy farmers below their cost of production to be in an export market, we probably shouldn't be in one. It's as simple as that. This makes sense. While the costs of production are rising, we cannot afford to have our farmers paid at or below the cost of production.

But there's a third thing the government can immediately do: get on with developing a truly strategic national drought policy for this country. The agricultural sector suffering most from drought is arguably the dairy industry. But no, the minister at the table laughs at this idea that we should be working on a bipartisan basis to develop a strategy for the drought in this country—a drought which has been going on for nine years for some farmers and for fewer years but more severely for others. Mr Deputy Speaker Hogan, you understand this because you know what is happening in your own electorate.

So I extend the offer again today to the minister and to his Prime Minister. It's not too late to reset. You'll be forgiven for all your mistakes. You'll be forgiven for all the pain you have inflicted on the dairy industry for the last six years or more if you just commit yourself to a code of conduct, to a minimum farmgate milk price and, finally—you are the drought minister—to putting in place a truly national strategic drought plan rather than just kicking the issue down the road hoping that tomorrow it will rain.

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