Damian Drum (Nicholls, National Party) Share this | Hansard source

We've heard the member for Hunter try to appeal to his coalminers from the Hunter region, saying the Labor Party isn't going to take your job; the Labor Party isn't going to put up prices. I think his speech was more about making a plea to people to believe him than about making any legitimate point.

This bill, the Farm Household Support Amendment (Relief Measures) Bill (No. 1) 2020, is about this government, a government I'm very proud to be a part of, giving a hand-up to people that are in a really, really tough bind—people working on farms who find themselves in drought.

I first became associated at a federal level with the farm household allowance when the milk crisis hit in May 2016. Murray Goulburn, as they were back then, realised they'd been paying their farmers a price they couldn't afford to continue to pay, so they said to their dairy farmers, 'We've been paying you over the odds for the last six to 12 months; we want all that money back.' Then we had others like Fonterra say, 'Yes, us too. We want our money back as well.' So they set a much lower price and then demanded hundreds of thousands of dollars. These farmers, who had obviously been meeting their commitments, needed to somehow or other find hundreds of thousands of dollars to repay that money. It put our dairy farmers in an incredibly tough position, and many farmers simply got out. They simply couldn't repay this money. That was my first taste of that, seeing the dire situation that so many of our farmers had been put in through no fault of their own but simply the mismanagement of the processors. And the processors were all playing dumb, saying, 'It's the fault of the CEO.' The CEO was telling them that they could afford a certain price that they couldn't.

So we had a whole dairy industry that went into freefall. All of a sudden, prices were slashed, and farmers that had built in a much higher return on their produce were trying to work out how their business model for the farm was going to work with literally hundreds of thousands of dollars slashed from their income. The need for farm household allowance absolutely spiked as we went through those months of the milk crisis.

There were a whole range of meetings that were held around the Goulburn Murray and through northern Victoria about how we needed to simplify the application process that was put in place—and it was quite a strenuous and arduous process to be able to get farm household allowance. It took on board your assets. So many farms are tied up in trusts, tied up in family businesses, and so many farmers have off-farm assets and they have very complicated business models. When you have such a complicated business model it's difficult to actually be able to receive a type of government assistance that, in many instances, very much rivals and looks like Newstart allowance. It's a very similar type of commitment that the Australian government want and demand on behalf of their taxpayers. These farmers have to supply an incredible amount of detail and really do have to open up their books to ensure that they're able to get the assistance that we are able to offer.

It's also been refreshing that the government has listened to so many of these farmers' concerns. We've had issues about the protracted and prolonged application process. Many of the farmers are in quite a sustained and prolonged state of stress when they actually get to the stage when they need to apply for farmer household assistance and support. That puts them in a difficult situation when it comes to filling out so many forms. We have simplified this process dramatically.

Prime Minister Morrison and Deputy Prime Minister McCormack have had a lead role, along with the various agricultural ministers, in simplifying this process. The bills that we passed late last year and the bills that we are now moving to get through today are more attuned to making this process simpler. We've made sure that people who have been on the farmer household allowance for four years out of ten were going to be able to exit off it with a lump sum payment. We put that through, and that had the broad support of the advocacy groups. I know people would like to be on it forever; however, that's not the intent. What we've been able to do is find some middle ground here. As I say, for those with four years out of ten we have been able to exit over 1,000 farmers off, and that has effectively given them the opportunity to have that once-off lump sum payment as they exit the program.

We've also needed to have the asset value of the farms increased; we've been able to capture more farmers by taking the asset threshold up to $5.5 million. That's had a significant impact as farmers realise that they may have a significant asset in the shape of their farm. However, what we also realise is that sometimes that doesn't equate to their ability to get through a drought, to get through natural disasters and to work their way through, back to profitability. What they need is a little bit of help that puts some food on the table and maintains that dignity that farmer household allowance enables them to maintain.

When we think about the tough road that many of our farmers are treading at the moment, it's somewhat worrying when you compare what could have been had the election on 18 May last year produced a different result. Many of the farmers in my electorate of Nicholls are facing ridiculously high water charges. The pressure that has been put on the irrigation sector by the Murray-Darling Basin Plan was going to be made worse by an incoming Labor government when you looked at their policies in relation to water and what they planned to do with water if they were to assume government in May 2019. They made it very clear that they were going to go after 450 gigalitres of water from the Murray-Darling Basin, water that currently has a social and economic neutrality test around it, which means taking more water out of the agriculture sector simply cannot be done if you're going to cause social and economic detriment to the community surrounding those water projects. The shadow water minister, Mr Burke, said, 'No, we're going to squash that. We're going to go back and get rid of that definition. We are going to make sure if anyone wants to sell their water they can. If anybody wants to get involved in any water delivery program, they can do that.' This is going to take even more water out of the consumptive pool. The Labor Party were very bullish and very up front about this policy. They wanted to take more water out of agriculture. And the more water you take out of agriculture, the quicker that water spikes in price every time you go through a dry spell. So it was very clear in the lead-up to the election where the Labor Party sat when it came to water policy.

We heard the previous member's brazen attitude towards the price of electricity. Electricity forms one of the key costs of many farming businesses. To think you can effectively throw in an energy policy that is not costed and doesn't have the impacts for Australian farmers and simply say, 'We don't care about the impacts of our zero emissions by 2050. We're heading down this path and whatever will be will be,' just puts more pressure on our farmers as they look towards their future, and the future of farming is tough at the moment. There are many young farmers out there who are looking at their farming practice, their farming business, and they're running the ruler over it. They're saying, 'Do I really want to commit the next 20 to 30 years of my life to agriculture?' Whilst there are some incredible opportunities, there are also some incredible challenges—namely drought, ridiculously high water prices and uncertainty around water policy—and all of these make a future in agriculture a little less certain. That's why, again, we have to be very careful when we are helping our farmers through these natural disasters in the form of bushfires, in the form of drought, in the form of an incredible turmoil such as the dairy industry did in 2016.

One of the components of the legislation we're debating today is the enabling of more flexibility in what the farmer has to do to receive an on-farm assessment. We had a very strict 28-day time limit on that assessment and, while these assessments will still need to be completed, we have actually expanded the group of personnel that will be able to conduct an on-farm assessment and we have slightly relaxed the stringent 28-day time limit. I think that will help in a certain way. It has also made it a little bit easier for a farmer to calculate whether or not they are likely to continue to qualify for the farm household allowance. Your income will be based on your current income.

The previous system did create the situation where as people earned a little too much, they found they had to pay back money because at that time their income went over the threshold. So if that can be also slightly relaxed, that will make it easier for our farmers to move on to farm household allowance, stay on it for the right amount of time, receive the right amount of support and then also remove themselves from the fund once their income goes over a certain amount.

I think in general we have seen that the farm household support is at the right level for those farmers and families receiving it. It's not meant to be able to sustain a poor operating farmer; it's meant to be able to give those farmers going through a really tough situation on a temporary basis that little extra support they need so they can withstand these droughts, floods, bushfires and downturns in various sectors and still have a vibrant, economically viable business at the other end.

This is why I believe the farm household allowance is achieving the ends that it was meant to achieve in the first place. It has helped more than 13,000 farmers and their partners throughout the entirety of the program. Over $400 million has been given out over the last six years and it really has improved the financial circumstances of so many of our people that have been going through a very tough time. I hope it continues to fulfil this role. Legislation like that which we are talking about today will continue to make this process simpler, more practical, and more easily and better able to fit the needs of our farmers. I certainly hope that it continues to create the results that have been created in the past. I want to thank the various ministers who had input into making sure this fund was amended to make these important changes.

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