Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

I present the explanatory memorandum to the bill and I move:

That this bill be now read a second time.

Since the government earlier this week—indeed, only 48 hours ago—announced its intention to introduce amendments to the Wheat Marketing Act, there has been a great deal of public commentary. Indeed, those with a direct or even an indirect interest in the issue of wheat marketing could not fail to understand both the content and the importance of the bill that is now before the House. This would especially be the case following its introduction in the Senate yesterday, where there has been an informed and relatively lengthy debate on the bill that is before the House. Many of the issues of vital public concern, especially to wheat growers, have been well canvassed and publicised. In other words, the House is considering the Wheat Marketing Amendment Bill with a degree of background, public discussion and debate that is somewhat unusual.

For that reason, and given the time constraints, I will curtail the second reading speech that I would have presented under normal circumstances, especially given that it would reflect, in almost exact detail, the second reading speech already delivered by my representative minister in the Senate.

I will highlight a couple of key points. The changes are not intended to pre-empt or predetermine any long-term policy considerations by the government, nor does the government intend to hold the veto in the long term. The movement of the veto does not represent a change to the Australian government’s single desk policy. Instead, the vesting of the veto transfer from AWBI to the minister is in response to the particular set of circumstances that confront the wheat industry and therefore the government. These are temporary measures and will allow the government to undertake thorough consultation with a range of stakeholders, particularly with growers, in relation to wheat marketing arrangements for the long term.

These temporary arrangements are also intended to address the uncertainty caused by the ongoing debate as to short-term, medium-term and long-term arrangements for wheat marketing. This has to take place, naturally, with regard to the consideration of the long-term wheat marketing arrangements, in light of the Cole inquiry.

The government will honour its previously expressed commitments to consult thoroughly and widely with wheat growers, whose interests above all else are paramount in this debate. It may well be that a number of different agendas by individuals or organisations or even political parties can be identified and speculated upon. But no-one should lose sight of the fact that it is wheat growers’ interests and the national interest which are the dominant interests at stake here. The minister’s decision in exercising or declining to exercise a veto will be based on the broad consideration of the public interest, and naturally having in mind obligations under the World Trade Organisation, the WTO, in exercising these powers.

I will draw my remarks to a close to allow as many members as time will permit to contribute to the debate. This is of incredible economic and even social importance to wheat growers and their families as well as rural communities and even the national economy. Wheat is one of the great agricultural industries and export earners for this nation. The Australian government’s principal concern is for the industry and for individual as well as collective Australian wheat growers. To this end, we are committed to working with the Australian wheat industry to secure the best outcome for Australian wheat growers. I commend the bill to the House.

Leave granted for second reading debate to continue immediately.

Simon Crean (Hotham, Australian Labor Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

The fact that we are debating here today these rushed amendments, in the Wheat Marketing Amendment Bill 2006, to the Wheat Marketing Act is a clear admission of failure by the Howard government to properly manage Australia’s export wheat marketing arrangements in the interests of growers and of the nation. Until now, the single desk for the marketing of our wheat had stood the test of time and had served growers well for more than 60 years. A decade ago the Australian Wheat Board was seen as an organisation with a first-class international reputation that operated with integrity and delivered Australian farmers a premium return for their product. That reputation now stands in tatters. Commissioner Cole has shone a spotlight on the AWB and has revealed a corrupt corporate culture characterised by excess and arrogance. It is a culture that has cost the taxpayer $300 million—$300 million paid in bribes to Saddam Hussein—

Peter Garrett (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Reconciliation and the Arts) Share this | Link to this | Hansard source

Shame!

Simon Crean (Hotham, Australian Labor Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

bribes allowed under the government’s watch to a regime it was committed to topple. Wheat for weapons. Shame, as the member for Kingsford Smith says. Shame indeed! This is a disgraceful outcome, and the government has not been exonerated. It was found not to have been corrupt, but that was never the charge. The charge is negligence because that was allowed to happen under its watch. It should never have happened. In fact, through those bribes the Australian government became Saddam Hussein’s best friend.

It is also a culture that has cost Australian wheat growers $500 million in lost contracts so far. It is a culture which has seen the Australian Wheat Board shareholders lose half the value of their investments. And it is a culture which has exposed the Australian Wheat Board to potential future legal actions including: actions by wheat growers in the United States; a class action on behalf of B-class shareholders; action by the Australian tax office to recover tax forgone in respect of the illegal payments, the bribes paid by AWB; and a class action on behalf of some wheat growers seeking to recover performance bonus payments made by AWB International, the pool, to AWB Ltd. Industry estimates put the ultimate impact on AWB of just those cases—not the shareholder loss, not the bribes, not the lost contracts but those legal actions—at another $1 billion dollars. Some management! Some scrutiny! Some rigour! And the government, particularly the National Party, come into this place saying that they have the interests of the growers at heart. If they had the interests of their members at heart, how did they allow this shambles to occur?

Peter Garrett (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Reconciliation and the Arts) Share this | Link to this | Hansard source

It’s a disgrace!

Simon Crean (Hotham, Australian Labor Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

It is an absolute disgrace—and the government want to lecture others about economic management. This is economic management under their watch. No wonder they want to get through this legislation quickly. They do not want any more light shone on it because it will expose them to the disgraceful administration that has led to this outcome—an outcome through corruption, an outcome through negligence.

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

Incompetence!

Simon Crean (Hotham, Australian Labor Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

Well, let us go to the seeds of what created this, because it is incompetence on the part of the government. It goes back over a number of years, since the time the Howard government privatised the AWB back in 1998. It is now obvious that that structure that they oversaw was deeply flawed. Those responsible for putting that structure into place should now be apologising to every wheat grower in the country and every member of the Australian public.

To remind the House: it was the Deputy Prime Minister and his immediate predecessor who must accept prime responsibility for the development and carriage of the legislation that set up the current wheat marketing arrangements. It was the previous Leader of the National Party, the member for Gwydir, who did much of the early work in devising AWB’s structure during his time as primary industries minister. It was his successor, the current Leader of the National Party, who was agriculture minister during 1998, who took much of the legislation through the parliament. They both now stand condemned for having failed to produce a structure for the privatised AWB that was robust enough to maintain its reputation as a company worthy of the trust of the international marketplace and of Australian wheat growers.

It was in fact a succession of National Party agriculture ministers, including the current Deputy Leader of the National Party, that failed to ensure that the Wheat Export Authority did the job it was set up to do. When in government, the National Party gave a Corporations Law company, AWB, a legislated monopoly. They took the monopoly from a statutory body and gave it to a privatised body. The National Party had a clear duty to put in place a mechanism to ensure that the monopoly power was not abused. What was needed was a real watchdog, but instead of a Rottweiler they produced a Chihuahua. That is what happened: the Wheat Export Authority was pathetic in terms of its scrutiny. On paper, the Wheat Export Authority has extensive powers to oversee AWB’s management of the single desk. In practice, it was a complete flop.

In the five years that he was agriculture minister, the current Deputy Leader of the National Party did nothing to ensure that the Wheat Export Authority was doing its job. During those five years, the Wheat Export Authority—despite having the power to look at every contract and to demand a look at every document—completely missed AWB’s involvement in the wheat for weapons scandal. Even when the evidence was mounting and articles about the possible involvement of the AWB in sanctions busting were starting to appear in the press, all the Wheat Export Authority did was to ask the AWB if it was doing the right thing. When the AWB said, ‘Yes, everything is above board,’ the Wheat Export Authority just went back to sleep.

The minister responsible at the time, Minister Truss, was asleep, too. But in the minister’s case it is even worse, because he effectively condoned these activities back in March last year when he was asked about the wheat for weapons, the bribes and the kickbacks. This is what Minister Truss had to say:

But even if the Australian Wheat Board was paying commissions for wheat sales in Iraq, that would not cause any great worry.

That is what the minister said. He went on:

... if ever there were any kickbacks to the Iraqi regime, then I guess they would end up with the government. So that is not terribly unusual.

Not only was he asleep at the wheel; he was also prepared to condone this as normal practice. It is an absolute disgrace and the government stands condemned. Did they ever direct the authority to vigorously investigate the allegations that were flying around at the time? Of course not.

I went through that to talk about the problems. But I also want to contrast all that to the way in which Labor when it was in office administered and discharged its responsibilities in dealing with the single desk in very similar circumstances. When we were in office during the first Gulf War we had to deal with contracts of wheat to Iraq. The first Gulf War resulted in the United Nations sanctions—sanctions which the Wheat Board then set about corrupting, as seen in the most recent Cole inquiry revelations. Labor allowed no such rorting. Gareth Evans, the then foreign minister, insisted on his department satisfying itself that the sanctions were not breached by Australian companies—in other words, no bribes were paid.

John Forrest (Mallee, National Party) Share this | Link to this | Hansard source

No growers got paid, either.

Simon Crean (Hotham, Australian Labor Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

He did his job. During the Gulf War, we ensured that the interests of the growers were also protected, and I take issue with the member who has just interjected, because some contracts were under risk. As minister for primary industries at the time, I announced a $33 million ex gratia payment to grain growers. In office, Labor protected the integrity of the UN sanctions. But we also ensured grower interests were protected. That is what is called ‘taking responsibility’. That is what a minister should do. Not this crowd; not this clutch of ministers; not this group, who were warned time and time again. In fact, if you read the Cole commission report, the Cole commission established that they were warned 35 times yet chose to investigate nothing. They were not only not proactive—in the way that Labor was when it was in charge in ensuring that sanctions were not breached—but also incompetent and negligent. The ministers did not fulfil their duties.

The department of foreign affairs failed big time. The Cole commission report is damning about the activities of the Department of Foreign Affairs and Trade. I will quote this point, which came out of the Cole inquiry:

… DFAT did very little in relation to the allegations or other information it received …

The report goes on elsewhere to say:

DFAT did not have in place any systems or procedures in relation to how its staff should proceed in response to allegations relating to the breach of sanctions.

Damning indeed. But where does the buck stop? Should the government be able to get away with simply blaming its department? Should it be accepting any responsibility? Not this government. This government was asleep at the wheel and is now trying to crawl under a carpet and hide. So embarrassed is it that it will not take any responsibility. Now we have this half-baked measure, because it has to do something but it does not know what to do because the coalition parties are divided as to what the correct course of action should be. The buck stops with the ministers, and they cannot get away from the problems that they have caused.

It is clear that a succession of National Party ministers have let Australian wheat growers and the nation down badly. I ask this question: if the National Party—the old Country Party; the once proud Country Party—cannot stand up for wheat growers, who can they stand up for? They have let them down.

John Forrest (Mallee, National Party) Share this | Link to this | Hansard source

No.

Simon Crean (Hotham, Australian Labor Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

Well may you shake your head in shame, member for Mallee. It is an absolute disgrace, and you know it. You do not deserve to continue your representation of them. You call yourselves their champions? You have let them down disgracefully. Australian wheat growers fund the operation of the Wheat Export Authority through a compulsory levy—a tax. They have to pay for it and it did nothing. Don’t you think you would be asking for something in return for your money?

Kim Wilkie (Swan, Australian Labor Party) Share this | Link to this | Hansard source

Order! I remind the member for Hotham to direct his remarks through the chair.

Simon Crean (Hotham, Australian Labor Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

I apologise, Mr Deputy Speaker, but this gets me very angry because it should not have happened. It did not happen under our watch. One would expect that the National Party, who have so often claimed to champion the interests of their members, would have looked after them but they have done no such thing. They have disgracefully let their members down and I hope that that will be remembered in full the next time their members come to vote.

Australian wheat growers feel terribly cheated and now they are being asked to expect the solution for the next six months to rest where? In the hands of another National Party minister for agriculture. Why should they hold such confidence? That is the question that I think has to be posed in this chamber. The truth is that we have no choice but to go along with this proposal in the interim. But why is it that the coalition government—the National Party in particular—knowing this damning report was going to hit them, have not after all that time been able to come up with a solution and measures to take them forward? These measures today are simply a stopgap and have been trotted out by a desperate government on the last day of parliament and in the shortest possible time in an effort to buy time while they figure out what to do next.

The bill effectively takes the single desk power away from the Wheat Board and gives it to the minister for a period of six months. It is obvious that the government does not know what to do beyond that. We know that serious divisions have occurred within the coalition over the future of the single desk. I will never forget that wonderful interview between the member for O’Connor and Senator Joyce on Lateline one night. We were distracted by some other issues at the time, but this was pure diatribe against each other—and these are supposed to be people within the same coalition parties and with the collective interest of the nation at heart—a screaming match on national television, blaming each other, no solutions, diametrically opposed. And that is where the future lies?

Wilson Tuckey (O'Connor, Liberal Party) Share this | Link to this | Hansard source

Mr Tuckey interjecting

Simon Crean (Hotham, Australian Labor Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

And he is still at it. I hope he comes in; I hope he attacks again. This is a government that has overseen a shambles and is now a shambles itself in trying to arrive at a solution. The credibility of the National Party among its core constituency is at stake in this issue. The government cannot make up its mind about what to do with the single desk in the wake of the wheat for weapons scandal, so instead of decisive action we now have this stopgap measure. The Minister for Agriculture, Fisheries and Forestry spoke for about two or three minutes before scurrying out of the chamber. The person in charge of this issue—the future of the Australian wheat industry—is not even in this chamber for the short time it is taking to rush this legislation through. Why is he not here? He is ashamed. But worse, he will not take responsibility and he will not face the music.

This legislation transfers the single desk to the minister. The government will do a bit of consulting and hope that the way forward will become apparent during the next few months—a government without integrity, a government without a clue. The proposal is to transfer responsibility for the single desk to a National Party minister—one of the clutch, the ongoing succession of this brilliant band of duds. This person is now being charged by the government and left with the authority through this legislation to look after the industry over the next six months. It does not inspire confidence and nor should it. The government have known for at least 12 months what the problem is and they have done nothing. The truth is that the Wheat Board, as it is currently structured, cannot be allowed to manage the legislated monopoly.

We on this side of the chamber have great misgivings about the process the government is putting in place. Transferring the single desk power to a National Party minister raises real concerns, but even more worrying is what is not in the bill. Where are we headed from here? What is the government’s solution? What form will the consultation process that the government has talked about actually take? How can we be sure that all parties with a stake in the future shape of the wheat marketing authority will be involved? Vague statements and poor processes are not good enough. That is why Labor is proposing an amendment. I know that the member for New England is proposing an amendment too; I tried to talk to him about it before coming here. As I understand it, his amendment is in the form of leaving it to the growers to have a referendum of sorts. I might be misrepresenting that position and, if I do, I apologise. But our preference is really to give some teeth to the issues that the review process should consider. We need to assess these issues in the context of what has happened with the Cole inquiry. We have to pose the tough questions to get the answers that are needed to help guide us because we have no guidance from the government. The amendment effectively sets out what those issues should be.

The effect of this amendment would be to set in place a rigorous process that would ensure that all aspects of export wheat marketing are subject to an independent inquiry. For the sake of the growers and for the nation it is essential that we get the structure of Australia’s wheat marketing arrangements right this time. The National Party’s record on these matters gives us no confidence—and I have gone through that litany of mistakes—that they will be capable of delivering arrangements that will stand the test of time. Their division and their inability to deal with this issue properly and come up with a lasting solution demands a rigorous independent inquiry.

The amendment we are proposing is similar to one we put before the House previously. Back in 2003, when the government was tinkering with the Wheat Marketing Act, we proposed this very course of action. I just wish the government had listened to us then. We hear the Prime Minister, whenever he gets into a crisis, talk about embracing bipartisanship. Why didn’t they embrace it on this occasion and work with us to try to find a solution? We have some experience on this side of the House. We have known how to run successful operations in the primary industries portfolio. Personally, I have a great deal of experience with it. Why not draw on that experience instead of allowing this shambolic exercise to have occurred? It is a sensible approach; it was rejected then.

The wheat industry still provides the backbone of the economies of many communities around this country. Many regions are built around it. We have a responsibility to do the right thing in terms of fostering that industry. It is not only good for the communities; it is good for the nation as a whole. Wheat remains a significant export earner for this nation. In most years—although this is a tragic one because of the drought—more than $5 billion in export earnings is gained from the wheat industry. Obviously the drought is having an impact this year, and many communities in the wheat belts are going to suffer significantly.

The single desk has been central to our wheat marketing arrangements since 1939. Labor has always been a strong supporter of it. We went to the last election with a commitment to maintain the single desk as long as it was delivering a benefit to the growers and to the nation. We stand by that commitment. But, in the wake of the wheat for weapons scandal, it has become clear that the arrangements as they are cannot remain.

The Grains Council of Australia has recognised this and has produced a set of principles against which any future model for export wheat marketing arrangements can be judged. While Labor does not necessarily endorse all of these principles, each is worthy of consideration. The principles are:

1.

Ownership and control by growers of the core element of the wheat export system,

2.

Security of payment to pool participants,

3.

Maximisation of net returns to pool participants through the development of efficiencies in the supply chain and through the development of an advantageous market position for Australian wheat and,

4.

Having the highest levels of governance and transparency to ensure that the system is providing the best possible service and returns to pool participants.

5.

The ownership of the ‘single desk franchise’ (the general exemption under the Wheat Marketing Act) should be separated from any organisation providing commercial services to the single desk.

That was a fatal flaw in the current structure. The final principle is:

Any contractual arrangements for the provision of services between the single desk owner and a commercial service provider should be both transparent and contestable.

We are dealing with what has been the greatest scandal in this country’s history—a scandal of mammoth proportions and a scandal that has major ramifications for the future of the wheat industry. We have to get it right for the future because we have got it so wrong under this government in the past. That is why the amendment that we are proposing seeks to put the rigour into the assessment that the government is failing to do itself. I urge the House to embrace the amendment and to use the period from now and over the six months during which this veto power is being transferred to the minister to actually get the system right. I foreshadow that I will be moving an amendment on behalf of the Labor Party during the consideration in detail stage.

Wilson Tuckey (O'Connor, Liberal Party) Share this | Link to this | Hansard source

I hope that the member for Hotham will remain here for a moment because I, too, have a long memory. Of course, the reason we have this disaster on our hands today is that the Labor Party, I think back between 1984 and 1989, actually did a deal with the Grains Council by which the government no longer had a responsibility to underwrite wheat sales under the export monopoly but agreed to let a group of agripoliticians impose a two per cent farm-gate levy on wheat growers that became known as the Wheat Industry Fund. Whether intentionally or not, the member for Hotham approved it and told people that that was a fund supposed to offer restructuring for wheat growers when in fact, from the day it commenced collecting revenue, it was designed to allow the Grains Council people to get $220,000 a year as chairmen of a corporate entity that was to be funded by that tax. What is more, at times it represented 25 per cent of the disposal income of wheat growers in my electorate. So for the Labor Party to say that they have not had a finger in this pie is untrue, but I will accept that the scandal that was exposed by the Cole inquiry started in 1999, after this government moved away from a government controlled export monopoly to one controlled by a corporate entity.

Back in 1998 when clause 57(3C)—a clause that was in the original act that removed this veto entirely; it did not transfer it—was removed from the act, so the act now goes from 57(3A), 57(3B) to 57(3D), not one person in the Labor Party spoke about drawing the last pair of teeth from the chihuahua. Let me say that. Nobody over there spoke against it. I did. In fact, I threatened to sit in splendid isolation on the other side of the floor, opposing that removal. This chamber passed that section that said that the veto provisions would cease to exist on 1 July 2004. When it was brought back to this House, nobody opposed it bar me. So we do not want too much proselytising or pontificating from the Labor Party.

But on the other hand, because we are containing ourselves, I reject their proposed amendment to the Wheat Marketing Amendment Bill 2006 on the grounds that I have had enough of the past. Yes, I want an inquiry that will identify the road to the future, and I have worked assiduously for a year to modify the existing legislation to achieve that outcome. So rather than giving us that lengthy speech today, having been in possession of that legislation amendment, the member for Hotham might have told this House that they would support that as a principle which does one thing and one thing only: it returns the control of the export monopoly to the government authority and gives it the power, through the export licensing system, of making people behave. It removes the exemption that AWB has from the licensing system. It removes the exemption that AWB has from the Trade Practices Act.

If ever a piece of legislation was written to encourage corruption and exploitation, this stands as the best example that ever existed. The legislation that we propose cleans those matters up, but does not cease the regulatory arrangements. I hope the opposition, if they are consistent with the rhetoric of the member for Hotham, would see that as a sensible proposal.

But what does this legislation do? Firstly, it transfers the veto power to the minister so that people, particularly in Western Australia, can get a fair price for their wheat. What else is proposed by the government? An appropriate consultation process. I have heard some horrifying rumours as to who might conduct that process. They are the people who should be giving evidence to the process, not deciding the outcomes from within. I am supported by one of my long-term adversaries, the Grains Council of Australia—the GCA—in that proposition. They have written to me and said, under the heading ‘Consultation Mechanism’:

An independent Task Group of three persons be established to drive the consultation process.

The Task Group to be chaired by an independent eminent person, preferably with a strong business background but not necessarily involved—

and I would say not by any means involved—

in agriculture.

They also believe:

The Task Group should be convened by the Prime Minister and report directly to the Prime Minister. The Prime Minister’s office should provide the Task Group with sufficient support and funding to meet the proposed timeline.

Now who could criticise that? Anybody who decides that there has got to be some sort of mates arrangement for those who would assess the consultation they received has my total opposition. The whole process has got to be that those, including myself and others, who wish to put a view, put a view. The people who assess that view must be independent of all of the prejudice, all of the myths and all of those situations that surround wheat marketing today.

I want to put on the record to the minister—he is present in the chamber—that there are a number of us who would not tolerate anybody with a specific interest. I may as well argue that I did the consultation—I could give you the answer now, but that is not what we are proposing. Let everybody have a say, and let some people of integrity and people with experience come to that conclusion. That is most important.

In closing, let me say why the experiment of farmer ownership failed. It failed in the first instance because we created legislation that was in conflict with company law. As the directors of AWB have now told the Prime Minister, you cannot have a corporate entity and give it a responsibility to its customers; its responsibility is to its shareholders. If we are going to have a system of regulation, the regulator has got to be a government statutory authority with, in my view, a simple task: to control the export of wheat to maximise the financial return to growers. That would be a contestable issue. Of course, were it misapplied or dishonestly applied, the aggrieved parties from whatever direction could go to the judiciary through the Administrative Appeals Tribunal or whatever.

The other thing that is absolutely necessary is transparency. We are still arguing the case as to who should compensate growers who, by their own choice, have locked themselves into the AWB—gifted their wheat, as has been their practice. Nobody seems to think that the body to fix that is AWB Ltd. In the last 10 days, GrainCorp announced that this season it will lose $20 million and its shareholders will bear the pain. But AWB says that, notwithstanding how little wheat there is around, its shareholders are entitled to nearly $40 million for administration of half a million tonnes of wheat that, by its own admission, has been sold already. What do they need the money for? They have sold it, and they have sold it at a discount. That is why they are in trouble.

The reality is that, if there is a problem for those growers, the simple solution is that AWB Ltd could say, ‘Look, we don’t want the $30 or $40 million; we’ll carry the cost of administration against our own profits that we distribute to shareholders.’ And/or they could release those people who have delivered of their obligation, and tell them they can take their wheat to someone else who is paying a better price. But to suggest that, for instance, the people who cautiously did not deliver their wheat to AWB should pay some sort of cross-subsidy to those who did is bizarre. Any other payment is a direct subsidy for the shareholders of AWB, of which less than 40 per cent today are farmers.

Would anybody stand in this place and suggest that the shareholders of HIH should be bailed out by the companies that took over their insurance liabilities? Who would do that? Why do we have a system that gives no more security to people who deliver to that company than to those people who had contributed over years with the aspiration of having a superannuation policy with HIH? The company went broke and they got nothing.

I will conclude my remarks because of the shortness of time and to give other members a say, but I want it understood that we are now aiming for the future. We have taken an interim measure. I do not want inquiries or dredging exercises into the past; I want the consultation process to be conducted as requested by the Grains Council of Australia and to be absolutely independent.

Peter Andren (Calare, Independent) Share this | Link to this | Hansard source

Before I begin my contribution, I want to make the point that the Wheat Marketing Amendment Bill 2006 is a crucial piece of legislation that impacts on a major export industry in this country. I do not think that any of us should be forced in any way into truncating our comments during this debate, although I will keep mine as short as possible. It is an issue that warrants a close examination by this parliament before it is subjected to a vote, and that includes the amendments that have been foreshadowed.

I want to place on record some of the concerns I have received from growers within and outside my electorate about the likely impact on selling wheat of the demise of the single desk. I know this legislation is being presented as an interim and temporary measure, vesting the power of veto with the minister, but it is regarded as the thin end of the wedge by many growers for the government’s eventual capitulation to those forces in the wheat trade, especially large global operators with their economies of scale, that can gazump our markets so effectively and that would want to destroy the combined clout that Australian growers obtained through the single desk.

The word I get from growers is that the predators want a share of the 16 per cent of the world market Australia enjoys—a market maximised by AWB International. The marketing advantages of the single seller have enabled Australia to maintain that market share. Wheat growers own all of AWBI and the majority regard that as their most important guarantee of a guaranteed price in a corrupted marketplace. AWB no doubt added to that corruption with the help of a see-no-evil government, but that is no reason to throw away our marketing advantage. That is what I am hearing from growers. I am advised that any alternative single marketing arrangement to that which currently exists would be instantly and successfully challenged at the WTO.

The minister says this bill introduces temporary measures to address the immediate concerns of Australian wheat growers. It provides for the temporary transfer of veto power for bulk wheat exports from AWB International to the Minister for Agriculture, Fisheries and Forestry until 30 June 2007. The minister in the other place said during his second reading speech that the bill is designed to:

... address current concerns in the industry about the wheat marketing arrangements, particularly in Western Australia where there is not the same range of domestic marketing options as there is in the eastern states.

However, these conditions existed long before the Cole inquiry. There are many growers highly suspicious of the catalyst the Cole inquiry has given for the break-up of the single desk, albeit through this temporary arrangement involving the minister holding the veto for six months. The minister in the other place said these temporary measures would allow:

... the government to undertake thorough consultation with a range of stakeholders, particularly with growers in relation to wheat marketing arrangements for the long term.

The Deputy Prime Minister seemed to avoid consultation with growers when he answered a question in this House from my colleague the member for New England during the week. The honourable member will be introducing an amendment to this legislation to absolutely ensure that growers are not only consulted but listened to and that their views are taken into account by way of a vote on their feelings about any change to the single desk. I would expect every member to support that amendment, particularly those National Party members who claim to be supportive of retaining the single desk.

We are told that under this legislation the minister will have power to make a decision on bulk wheat exports based on the public interest. This is a vague term indeed, and most growers doubt that, with the door now open to the dismantling of the single desk, this power will mean anything other than the interests of non-pool sellers. Let the National Farmers Federation and the New South Wales Farmers Association swing in behind their members and not buckle to the demands of the local and international operators like Cargill or those other opportunistic players in the market. Eighty per cent of growers want the market advantage of the single desk. It is the envy of our competitors, and that is why they want it dismantled.

I have an open mind on just how a single desk should be structured. The previous speaker gave some indication of his views on an authority that should be put in place to handle wheat sales. Perhaps a stand-alone authority is the sort of structure that is required. But I know one thing: the removal of AWB’s veto suits this government down to the ground, despite the protestations of most growers. This is a free-market issue for the government, not a fair market one. It has already conveniently pleaded ignorance of corruption in the Iraq market and no doubt is about to surrender the advantage of critical mass through a common pool and single desk to a free market that is corrupted by the enormous subsidies available to our competitors, particularly the US, who have the temerity to challenge our attempt to maximise returns to growers.

The alleged commitment of this government to the single desk has always bemused me and many growers. How does it fit in with the red-hot free-market instincts of the Treasurer and the Prime Minister? It did not and was an irritation that the government knew it could not get rid of until—surprise!—a scandal came along that has allowed the government to get off the hook. That is what this eventually is all about. The Prime Minister said:

You couldn’t get a proper outcome while the veto lay with AWBI because AWBI was not only, how shall we put it, a player, but was also the holder of the veto.

By this logic, why did AWB International ever hold the veto power?

David Hawker (Speaker) Share this | Link to this | Hansard source

Order! It being 2 pm, the debate is interrupted in accordance with standing order 97. The debate may be resumed at a later hour and the member will have leave to continue speaking when the debate is resumed.