Sam Birrell (Nicholls, National Party) Share this | Hansard source

I rise to speak on the Primary Industries (Excise) Levies Bill 2023 and cognate bills. These bills are the culmination of a lengthy process started by the coalition to streamline and simplify the levy system that underpins primary industry in Australia, including in the electorate of Nicholls that I represent.

In 30 years of operation, the levy system has allowed farmers to collectively pay for research and development, marketing, biosecurity activities, national residue-testing, and responses to exotic pest or disease incursion. The system had become complex and unwieldy—more than 50 pieces of legislation existed governing more than 110 levies over 75 commodities and 18 levy recipient bodies—and this seeks to streamline and simplify the process. The coalition recognised the need for reform, and the streamlining and modernisation of the agricultural levies legislative framework commenced under the former coalition government back in 2017-18. The legislation was reviewed and included targeted consultation with 70 stakeholder groups. The review found that the legislative framework serves the objectives of the agricultural levy system but that the current legislation was ineffective in meeting industry needs now and into the future. It is also overly complex, there is a lot of duplication and it is inconsistent. So the coalition committed $7.2 million in 2020-21 over four years to modernise the framework into a business-friendly, fit-for-purpose and easy-to-use legislation framework as part of the deregulation agenda.

Why is the levy system so important? The agricultural levy system is a longstanding partnership between industry and the Australian government to facilitate industry investment in strategic activities, research and development, marketing, biosecurity activities, and residue-testing, and the government collects and disperses the levies on the industry's behalf. I have had personal experience of agricultural research in my profession before I came to this place, and some of the research and development that's done by Australian agriculture is truly impressive and fascinating, and keeps our farmers at the forefront of being competitive globally, maintaining our reputation as a clean and green place to grow healthy food.

I'll give a couple of examples about the sort of research and development that these levies fund that I have been personally involved in. One is mating disruption in fruit crops. Mating disruption is basically using a nontoxic, chemical way of controlling pests in horticultural crops. The research I was involved in was around the oriental fruit moth and the codling moth in apple crops. I don't think that moths having sex has ever been spoken about in this place before, but I'd like to bring it up. What we were able to do was use research and development funds to put pheromones into trees, which confused the moths into fertilising what they thought were eggs but weren't. This brings the moth population numbers down and reduces the need for us to spray what were then some toxic chemicals onto our fruit crops. It's a great innovation and the sort of stuff that this levy work does. Also, I've been involved in the efficient use of water drip irrigation, with some great technology from Israel that I was talking to the member for Berowra about earlier. It's great Israeli technology that uses water much more efficiently, where it is delivered subsurface and via drips with the fertiliser actually in the water. These are great advances and are examples of some of the things that these levies contribute to.

The Australian government matches the industry investment in research and development, with a target investment in R&D equivalent to one per cent of the gross value of production. In 2021 and 2022, the department disbursed around $600 million raised from levies and charges imposed on industry. Over the forward estimates, in 2026-27 similar amounts of levy and charge funds are expected to be disbursed each financial year. However, this is farming, so there will be year-to-year variation because production, the commodity market and some technological advancements vary. We're supportive of the changes these bills will make to the levy system, and we want increased transparency for levy payers. They deserve to know where their money goes and how it's spent. It's very hard for farmers in some industries to earn money. They deserve to know, and for it to be very transparent, where that money goes. Easier adjustment of levies can be made through a consultative process with levy payers, capturing agricultural services, such as bee pollination, and allowing for the coverage of horse disease without the need for additional specific legislation. The process is being supported by industry as the current levies legislation is too convoluted and too complex, as was identified by the previous coalition government—and I give credit to the member of Maranoa, who is in the chamber, for his proactive work on that. The increased ability to collect levies will increase compliance and make sure that there is more money for us to spend on these critical research and development projects.

This tranche of legislation does not include the biosecurity protection levy announced by the government in the May budget. This biosecurity protection levy will impose a compulsory levy on all levy payers, at a rate of 10 per cent of their 2020-21 rate, and that varies between industries. Ninety-two per cent of those agricultural industries have a levy, and those industries that do not will have a similar levy put in place as part of the biosecurity protection levy. The interaction between this biosecurity protection levy legislation and these bills is not clear yet. Logically, the new levy will be collected in the same way as industry imposed levies, although the collection agents who currently collect the industry imposed levy will do that with no funding. I can inform the House that across my electorate, and in the agricultural sectors that I talk to, jaws drop at the concept of producers being asked to pay a biosecurity levy to protect themselves from imports that compete against their products on our supermarket shelves. If you think about it, you're out there working really hard to grow clean, healthy Australian fruit for Australian consumers, and you've got to pay someone who wants to import some fruit from another country to compete with you on supermarket shelves. That's not the way that our levy system should work at all. Those who create the risk, the importers, are the ones who should be funding the biosecurity compliance, to eliminate that risk to Australian producers. The producers shouldn't have to pay for it themselves. They're paying too much as it is. They're going to be paying more for water, too, if the current restoring our rivers bill goes through. They shouldn't be paying a biosecurity levy to their competitors to help their competitors compete against them. Heads are shaking in the agricultural sector and amongst the producers in my electorate at the concept of that. It's unbelievable.

The industry imposed levies contribute funding to Plant Health Australia and Animal Health Australia. PHA and AHA facilitate a national approach to enhancing Australia's plant and animal health status through government and industry partnerships for pest and disease preparedness, prevention and emergency response and management. Plant Health Australia has 39 industry members, and Animal Health Australia has 14 industry members. The bill will remove references to the PHA levy and AHA levy, and it will be renamed the biosecurity activity levy.

The coalition started and funded a process to streamline and simplify the levy system, but this government is planning to add some complexity and confusion back into it. We're opposed to that. Once the biosecurity protection levy comes into force, there will be three types of biosecurity levies: a compulsory biosecurity protection levy, to be introduced by the Labor government to pay for departmental biosecurity functions; a voluntary biosecurity activity levy, for biosecurity projects identified by industry as priorities undertaken by Plant Health Australia and Animal Health Australia; and a biosecurity response levy, referred to as emergency animal disease response or emergency plant pest response levies.

While the coalition aim for greater transparency, this will become a bit more opaque. There's a lot of confusion in what I just said there, and the producers are seeing this as confusing as well. They're seeing the removal of references to Plant Health Australia and Animal Health Australia as confusing. They see that as removing the transparency of where the levy funds are going. The levy payer will likely become confused when paying a biosecurity activity levy, a biosecurity protection levy and a biosecurity response levy. It's important that levy payers understand exactly where their funds are going, and that's why we wanted the amendment relating to transparency. As I said earlier, it's very difficult to run these agricultural businesses with drought, flood and all sorts of challenges.

A division having been called in the House of Representatives—

Sitting suspended from 11:07 to 11 : 15

Before the suspension I was able to give my own examples of drip irrigation, fertigation and moth-mating disruption, which was good to talk about here; I enjoyed that. But, in summary, these are necessary legislative changes, so that there is transparency and ease of use and so that we maximise the amount of levy money for this important research and development.

The streamlining of the levy process is supported by the National Farmers Federation. It is a result of lengthy consultation that the coalition commenced, and it reduces complexity and increases compliance. It can be improved. If we have all gone to the trouble of making this levy system simpler and more transparent, we shouldn't be inadvertently or deliberately masking the portion of the levy that goes to support Plant Health Australia and Animal Health Australia. As I said earlier, the amendment to increase transparency is really important. It's challenging enough for farmers at the moment. They're generally 'happy' for this levy money to go to these necessary research and development and protection areas, but they want where that money is going, who's spending it and how they're spending it to be absolutely transparent. That accountability is really important.

I commend the bill with the amendment to the House.

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