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

It is with pleasure that I support the Farm Household Support Amendment (Additional Drought Assistance Measures) Bill 2008, not because I am a supporter of drought—in fact I oppose drought quite dramatically—but because I think it is appropriate that governments of all persuasions support those people, the farming community, who are suffering from drought. It is good to see the current government in the budget papers carrying on the assistance that the previous government put in place for drought affected farmers.

As I speak, in parts of Australia, particularly the grain-growing belt of the north-west and New England, rain is falling. Hopefully it will fall in many other areas so that the need for such assistance long term will be wiped out by some degree of prosperity in the farming community. This drought has been going on for many years and there has been a degree of support from various governments—household support such as we are looking at tonight. Exceptional circumstance and business assistance has also been in place. From time to time the government has used supposedly appropriate figures for exceptional circumstance and household assistance to display that there has been an enormous amount of assistance going to the farm community. In fact, if you look back through the figures for the last six to seven years of the drought, the assistance that has been given to the building industry comes to mind particularly because of the first home owners scheme, which was set up, as you would remember, Mr Deputy Speaker, in response to the impact of the goods and services tax on the building industry. Something like $7 billion has been expended in that time in assistance to the building industry via the first home owners scheme. I think many commentators would suggest that in a lot of ways that has not helped first home owners. It has probably inflated the value of the properties and houses that have been purchased. Nonetheless, from time to time, in the media at least, arguments are produced that there has been an enormous amount of money allocated to the farm community to support it during drought.

If people refer to the actual spending that has taken place over a period of years, they will see there have been quite small sums of money—some hundreds of millions of dollars on average. To other industry groups in Australia—the car industry; the building industry, as I mentioned; the oil industry; and many other industries—there is something like $12 billion to $15 billion annually of assistance. The amount of assistance to the farming community on average over that period has been $200 million to $300 million. That is for one of the most important industries in Australia—and I refer to the exceptional circumstance business assistance arrangements that have been put in place.

Many people, including the politicians in this place, like to refer to exceptional circumstances drought assistance as not only being business assistance. I am pleased to see the Minister for Agriculture, Fisheries and Forestry here because I think he is aware that the figures for exceptional circumstances drought assistance have on average, since the drought started, represented quite a small amount of money in total. It is some hundreds of millions of dollars annually, but compared to other industries—the car industry; the housing industry, through the first home owners scheme; the oil industry et cetera—it is a small amount of money.

What has happened in terms of the politics of drought assistance is that the exceptional circumstance household support has been bracketed in as being some sort of business support to agriculture. Technically, if you are unemployed in this country at the moment—and household support is the payment of an unemployment benefit to those who cannot work—you can apply for unemployment benefits. In the farm sector’s case, where they are not unemployed but they are not earning an income—so in that technical sense both an unemployed person and the farm sector, if they pass the criteria in relation to exceptional circumstances, are the same—they will be considered the same as the unemployed because they are not earning an income.

But some politicians tend to refer to the combination of both the household assistance—which is the unemployment benefit, Newstart—and the business assistance as being drought support. Drought support in my view is exceptional circumstances business assistance.

I have just had a message that it is raining at home as we speak. Being a practising farmer I am pleased to see it is raining at home and I am glad my wife called to tell me.

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

I would like to congratulate the honourable member for New England but perhaps he should focus on the provisions of the bill before the chamber.

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

Yes, I am, Mr Deputy Speaker, because, if it does rain, there is less need for government support, such as household support. I am delighted to have had a call from my household because we live in a drought area.

Government Member:

Move to North Queensland.

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

I am not moving to North Queensland. I think it is most appropriate that, in a debate on drought, we are actually talking about rain, and the hope and promise that it gives. The mere fact that my wife has taken the time to ring expresses the attitude of many country Australians and the delight they have when rain actually falls. Mr Deputy Speaker, it gives hope for the future and I think we should all be very pleased to see it. I know that in your electorate there has been a degree of rain in recent days as well. No doubt you will be speaking about that at some future time.

I make those points in relation to drought assistance because, I think, one of the tragedies that have occurred in recent years is that a lot of farmers and their families—and I know the minister for agriculture would be aware of this—have felt that, through the treatment of the issue in the media, there has been this enormous expenditure of largesse imparted to them because of the drought. But as I said, household support is essentially an unemployment benefit for anybody who is not earning an income. In the farmers’ case they are not earning an income but they are still working. In that sense I believe they are entitled to household support as much as any other unemployed person who is not earning an income. But if you look at the business assistance exceptional circumstances arrangements and compare them with those for other industry groups, the assistance has been quite small.

I know that the previous government tried to make a great play out of this enormous amount of money, apparently, that they were expending on agriculture. All that did in a sense was make people feel as though they were being painted into a corner for a circumstance that they had absolutely no control over. The events of the last six or seven years have been absolutely exceptional. Whether they are combined with climate change and a whole range of other things is a debate that will happen at another time. But I think it is appropriate that during these periods we do support one of the biggest industry sectors that we have in Australia because it is quite impossible for any business to put in place arrangements that will see them weather a six- or seven-year storm in their financial situation.

The business component of the exceptional circumstances drought assistance is essentially about maintaining the farm sector in a physical and financial position ready to accelerate into productive activity when the drought breaks. Climate change and some other things have clouded the issue in terms of that productive capacity. So I support the legislation and I am sure most people will.

The other issue I would like to refer to in terms of this particular legislation is the review that will take place—I have got no doubt—about drought assistance for the future. There are a number of issues out there that really do need to be taken into account. If we are going to review drought assistance, some issues to consider are: how we regard it in the future; what role it plays in terms of climate change; and who funds the various arrangements, if in fact there are to be funding arrangements put in place.

One of the things that I have called for over many years, even prior to coming into this particular place, is the need for a natural disaster fund. Looking back at the various disasters that have occurred in Australia—the Newcastle earthquake, the Wollongong mud slide, the catastrophe at Coffs Harbour, the Darwin cyclone or more current events that have occurred around the nation—I think there have only been a couple of occurrences, when you include the cyclone that occurred on the Queensland coast last year, where the totality of disaster in Australia, and I include drought in this, has been over a billion dollars. A dollar a week from every Australian raises a billion dollars in a year. So the capacity to raise money is there, and governments have that opportunity through various levies et cetera. With reference to the Insurance Council in relation to the payouts for disasters et cetera, I think the average annually from 1974 through to the early 2000s was something like $250 million to $300 million in terms of a disaster, with the amount for the odd ones such as the Newcastle disaster obviously of much greater magnitude. But if it is averaging at $200 million, $300 million or $400 million, then in rough terms that is 20c, 30c or 40c a week for insurance against disaster.

I think drought, in very special circumstances, should be considered a natural disaster in a sense. There may be a movement at the margin in relation to people practising agriculture in marginal zones where maybe they should not be, and all those sorts of things can be discussed in forming policy. But I think there is a real possibility of being able to combine, in a national natural disaster fund, a nonpolitical way of addressing these things when there is money in a fund. We saw many circumstances under the previous government where various areas in various states and electorates would be treated differently in terms of whether they were in exceptional circumstances or not. Whether they were being treated on a political basis or not, it was left open to that interpretation by those who wanted to take a political point or make a political point. That might be all right for those of us in this building, but it is not necessarily good for those people who are out there suffering the stress of the particular pain that they are going through. I will just leave that proposition at this point as something to be considered, in terms of a fund that is available, not coming and going with the electoral cycle and reflecting where the drought is and the marginality of the seats at that particular time.

The minister for agriculture has heard me say some of these things before, but I think I will replay the record in a sense as it applies to drought. In any review of drought policy, and if we have some regard for climate change, we are really going to have to develop a policy mix that encourages a more productive technology in terms of soil health and moisture infiltration. There are a number of techniques out there. In the farm sector, for instance, no-till technology has revolutionised agriculture and has been the biggest adaptation to climate change that I have seen in my lifetime. What it essentially means, Mr Deputy Speaker Slipper, as I am sure you are well aware, in our better soils—our black soils of the Darling Downs, the Liverpool Plains, Emerald and those areas in Queensland—is essentially six to eight inches or 150 to 200 millimetres more rain or moisture available to the cropping system than would have happened under traditional agricultural practices. That is an enormous adaptation to change—so much so that in the lower part of my electorate this year, still in the worst drought in living memory, there have been record sorghum crop yields based on that sort of technology.

There are a few other benefits that that technology has, not the least of which is to do with the so-called carbon debate and the emissions-trading arrangements that we are looking to in the future. I think it relates to drought policy quite specifically. There are also holistic grazing techniques that are adapting our landscape to drought in a far more favourable way than some of the more traditional techniques of the past. And those sorts of techniques are also having an influence on carbon, or humus and organic matter build-up, in our soils because there is a nondisturbance of the mulch or previous crop residue on top of the soil. In some of the grazing systems there is a range of options that are actually encouraging the development of humus and organic matter. As I am sure you are aware, Mr Deputy Speaker, humus and organic matter in a soil are carbon. That is how soils are grown, that is the existence of carbon. There are many potential technologies out there. There are perennial grasses, some of which could be involved in the cellulosic ethanol area, for instance, and that could have a positive impact not only on soil health, the capacity for moisture infiltration of the soil and drought preparedness, but also on the build-up of soil carbon. I know the minister of agriculture is aware that there are some measurement problems with this, but it could have a positive impact on this holistic approach to trying to rein in carbon dioxide.

I mention that in particular because it might be climate change to some people, it might be carbon to others and it might be emissions trading to some others, but in terms of agriculture it could be drought proofing some of our landscape. I encourage the government to have a very close look at that—and I know there is money in the budget—particularly in terms of some of the soil carbon measurements that are out there. I have an interest in soil health. I have a block of land that has been operating under the no-till system for 31 years—probably one of the longest in Australia—and the microbial and earthworm microclimate in that particular block of land is something to behold, as obviously are the yields that have been coming off it over that period of time. I have not measured the carbon, but others have.

If we are serious about drought policy, climate change and all the interactive factors, whether it be feeding the starving millions or feeding ourselves, we really have to start to measure some of the soil carbon issues that are out there. We should not appoint someone to go and do it but get out there at the cutting edge now, Minister, where real people are actually doing it. There are real people in Western Australia, in Emerald, in Warren and on the Liverpool Plains who are actually measuring these things that are happening in their soils now under new techniques, not old techniques. They need government to go there and prove them wrong, if they are wrong. If they are snake oil salesmen, let us prove them wrong. But do not set up another department to spend the next 10 years proving what these people are doing on the ground now. It is a critical issue and it relates very specifically to drought policy as it does to climate change, and the two in my view are very much related.

John Cobb (Calare, National Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

I rise to speak on the Farm Household Support Amendment (Additional Drought Assistance Measures) Bill 2008. The coalition supports the bill and we recognise the fact that last September it was supported by the then opposition, the now government, and we appreciate the fact that the bill comes before the House obviously with their support now.

On 25 September last year the government announced the measures in this bill which were to ease the access to EC assistance, broaden the current small business support arrangements, provide enhanced exit assistance and additional community and social support, and provide support specifically for irrigators. These were announced in September of last year and this bill is to ensure that those payments that have been and are being made are done under legislative cover, and, as I have said already, I do appreciate that.

It was very much about lifting the off-farm assets to $750,000. It was very much about broadening ‘drought’ out to recognise the fact that it is not just a farm problem; it is a community problem—the smaller the community, the more the community is obviously affected by it. It also raised the amount of off-farm income that farmers or their spouses or members of their family could earn and still get the household support from $10,000 up to $20,000. It meant that any business in a designated area in a town of less than 10,000 people would qualify to apply for the provisions of the small business assistance, which in effect did not vary very much from that which farmers were able to access.

The farm household support, which I have just mentioned, had additional drought assistance measures. It did change eligibility criteria somewhat but it increased the maximum allowable income exemption and it did the same for small business. It allowed farmers to continue to receive EC if there was a legitimate reason for their being out of the country, which, from memory, was to bring it in line with the way Newstart operates. You can get Newstart if you are overseas for the correct reasons and so, as it is a very similar thing, it was extended to exceptional circumstances recipients as well.

It also had provisions in it to help the families who had mental health problems. It is one of the very unfortunate side issues—or it is very much to the fore, I suppose. When drought goes on for as long as this one has—there have been six years of drought or six years of designated drought, and I will get to that in a minute—it has an awful effect on families and communities. The truth is we men do not seem to handle it as well as women do. The women have to bear the mental issues that men seem to be more prey to than they are. I do not know why that is but it does seem to be a fact. The women are damn tough. They have a lot to deal with. We men seem to go about our work and bury our heads and quite often not want to face the issues. Somebody in the family has to and it always seems to be the mother or the wife in the family who does that. I think that in this drought more than any other that I have seen—and I have seen a few—the mental health issues have been recognised, and I am very happy to say that the publicity about mental health as an illness rather than a freakish thing has been a very good thing for country people. It has meant that we are much more likely to talk about it and far less likely to hide it and not want to deal with it. Country people are much more exposed than their city cousins. Quite often in the city your neighbour does not know what is happening but, in the bush, the town and everybody else know the situation. If you go broke or something is wrong or your family is in trouble, everybody knows. So you are very exposed and people are very affected by that.

I remember the first time I took the then Prime Minister, John Howard, and the then Deputy Prime Minister, John Anderson, at the start of drought in October 2002 out to Cobar. It was a time when the drought was really starting to bite. In fact the Bourke and Brewarrina rural lands protection boards areas, which were the first two parts of south-eastern Australia to be declared in the drought, were declared some month or so later in November 2002. I remember even then, when it looked as bad as it did just south of Cobar where we were that day, that the Prime Minister became very aware and subsequently—I think it was probably about October 2006 when the Prime Minister came to Forbes or it might have been later than that, 2007, before this new declaration in September of last year—some friends of mine met with the Prime Minister at Forbes and explained to him the instances of suicide and everything else that was happening at that time.

They told him personally of the issues in their own family and of their neighbours. They had lost a son; they had lost a neighbour who had not been able to cope with the issues that five years of drought had brought. The Prime Minister and the Deputy Prime Minister at the time were very affected by it and they extended the mental health provisions and extended the amount of aid that was available to individuals, families and communities. That and extending drought circumstances to a community rather than just to a farmer have been two of the big differences that the longest drought of my lifetime have brought forward from the Parliament of Australia, which obviously approved that and will, I am quite certain, do that again with this bill.

While we are dealing with this bill, I need to speak about where the drought has got to now. This bill will recognise the mental health issues, the physical issues, the family issues and the national issues. The previous Treasurer, the member for Higgins, Peter Costello, quite often mentioned the effect the drought was having on overall domestic production, particularly on exports.

In eastern Australia, as I mentioned earlier, the first two places where exceptional circumstances were declared were Bourke and Brewarrina. On 15 June—in less than two weeks—that comes to an end. While there has been some summer rain in that area there really has not been anything much since about January. While it might look better than it did 12 months ago, nobody has any money. Brewarrina has about a 55 per cent Indigenous population and is mostly a pretty happy community. The people in that community are very dependent not just on agriculture but on what agriculture does for them, be they mainstream, Indigenous or whatever. If they were to lose the interest rate subsidy and exceptional circumstances on 15 June it would be an incredibly drastic thing for them. It would set a precedent. Yes, as a government it is correct that in the past, particularly along the east coast of Australia or just inland, we did take areas out of EC from 2002, but they were areas that had not been in drought very long. Bourke and Brewarrina have been in solid drought for almost six years. They have not made money in almost six years. They have no money now. Those that may have feed now mostly have probably only 30 per cent of their stocking rate. They need to spend somewhere in the order of $40 to $90 for a ewe to get their stock back up. They need to spend in the order of $500 to $1,000 for a cow and calf. At the very least they are going to have to buy 100 cows or 1,000 ewes to make any difference. So we are talking about up to $100,000 just for 100 cows or 1,000 ewes, and that will probably not come anywhere near to bringing them up to 50 per cent of their stocking rate. As we have already talked about, it is not just about the effect on them individually but the effect on them and on the towns of Bourke, Brewarrina, Louth, Tilpa, Goodooga, Weilmoringle and all those communities that depend upon them so much.

I cannot put too strongly the fact that after six years this drought is a tragic drought in terms of production loss and in terms of the fact that not everyone has or will survive this drought. But it is also a tragic drought because it has caused loss of life, the break-up of families, the break-up of marriages and children leaving home. It has had enormous repercussions not just for those farm families but for the communities around them. As I said earlier, Bourke and Brewarrina have less than two weeks to go and they still do not know their fate. I use the word ‘fate’ not to be melodramatic but that is what it is. They need the interest rate subsidy to carry them forward.

I mention also that most of Queensland, most of the rest of New South Wales and every region in my electorate is under exceptional circumstances. I am quite sure that the rest of the western division, most of western New South Wales, still is. I am sure that the member next to me at the table, the member for Murray, whose electorate will also come up in September, I think, would see this as just as big an issue as I do. I am sure that most of her region will still qualify in the south of the state simply on the physical side of it.

What we are talking about here is the ability of a farmer, a family or a community to get out the other side of this drought. Even if they have had rain they are still destitute. The communities are struggling. When I became the member for what was then the electorate of Parkes, which in land region is not much different, I did not think many more people could leave the region. Agriculture, which is the main employer apart from mining, had got so efficient that it could not really lose many more people. In actual fact the drought has changed that. People just had to struggle on—a man, a wife, a single person or whatever. Their children could not afford to stay with them. Mostly they had to go and seek work. Thank heaven for the mines being around so that sometimes they did not have to go too far to do that. It is one hell of an issue. You talk to the agents, particularly in the west of New South Wales, and they will tell you that exceptional circumstances is keeping—and I repeat keeping—a lot of that community together, particularly out west. As we come further east you then strike the issue of the cost of farming.

As we speak, people are waiting, hoping that after the great summer start we had it will rain again. I am sure that in my region well over half the crop has not gone in and, in relation to that that has, people are looking anxiously skyward. When super reaches $1,400 or $1,500 a tonne, when diesel reaches the $1.92 a litre I paid last week in my electorate, no longer do bulk buyers such as farmers really get a discount for diesel. It just does not happen. What we see at the bowsers is pretty much what they have to pay too. So when farmers, let alone graziers, are paying $1.90 for diesel and $1,400 or $1,500 for super then exceptional circumstances is certainly going to give the bank a lot of confidence when it makes a decision about whether it supports putting in this year’s crop. We are fast approaching a very critical stage. Yes, a lot of the crop has gone in, but there is a heck of a lot of it that has not, and that that probably needs a start.

Along with the minister, I commend the bill to the House. I appreciate the fact that his government has gone on with it. It is very necessary. But I must repeat that this drought is not at an end, and just because people have a bit of feed it does not mean they have any money and it does not mean that they or their communities can survive. The interest rate subsidy is probably all that stands between a lot of them not being there next year.

Jim Turnour (Leichhardt, Australian Labor Party) Share this | Link to this | Hansard source

It is great to be here tonight to support the Farm Household Support Amendment (Additional Drought Assistance Measures) Bill 2008. Exceptional circumstances were established under the Hawke government, and it is great to be part of a Rudd government supporting that long tradition that we have had in supporting regional and rural Australia. I was lucky enough to be born from farming stock. My parents had a property in the Northern Territory, 60 miles south of Darwin, and ran cattle and grew small crops. I currently live in Cairns and represent rural people in the Cape York Peninsula area. I have also worked extensively in western Queensland.

Having been born in the Territory and coming from tropical North Queensland—and I know the member for Kennedy would understand this—I can tell you we get a lot of rain up there and we are lucky to come from an area that does not necessarily suffer from drought. But, having come from a rural background, I do understand, having worked in the Gulf and areas around Charters Towers and, in part of my earlier career, around Moura and Emerald, that these are some of the areas that have had significant drought problems over the last five to 10 years. This bill is an important one in providing support to those farming communities.

We talk a lot in the Rudd government about working families. There are working families out in rural and regional Australia that this bill is about supporting. It extends exceptional circumstances payments to small business operators in towns or communities of fewer than 10,000 people. Exceptional circumstances was originally established to support farming families, but there is an increasing recognition that drought not only impacts on farmers and graziers but also impacts very strongly on those communities. There are small businesses in those communities that have been suffering through this drought, and it is great to be here tonight supporting this bill that will extend exceptional circumstances payments to some of those businesses and working families out there in rural Australia who are doing it tough.

The bill also allows those businesses—farming and other small businesses—to earn more off-farm income. Allowing them to increase the amount that they can earn from $10,000 to $20,000 is effectively doubling that. When they are out in rural Australia doing it tough, working people know how to work and they want to get out there and do more to support their families. They are looking to make off-farm income and are looking to get out and make a quid to support their families. They do not like taking welfare.

Rural people do not like receiving welfare but, sadly, under the drought that we have had for an extended period of time, many people who have not previously had to get welfare have had to. It is also sad that the many small businesses that will benefit from the change that this legislation allows and brings into being—the ability for us to continue to make those payments and recognise those that have been made in the past—will be getting welfare for the first time. They want to get out there and work, so allowing them to earn not $10,000 but $20,000 allows them to also get out there and make more money to support their business.

The legislation also provides some concessions under Austudy and youth allowance for means testing. There are plenty of people out in rural and regional Australia who are actually asset rich but cash poor. When you are in drought, you might have a $1 million or $2 million property, but you are not actually making any money. Similarly, if you have a small business in town—whether it is selling groceries, running a tourism enterprise or selling farm machinery or agricultural supplies—when farmers are doing it tough, they do not come through your door and you do not make a quid.

People also may not travel to regional and rural areas because they are concerned about the drought—they have heard about the drought and there is not the incentive to get out there and travel as much. So there are people in all sorts of businesses who, while they may not be working directly as farmers or graziers, will benefit from this because they have previously had income and they may have significant assets but they do not have any cash.

We want to ensure that young people who want to get an education do not have barriers put up. This legislation will allow concessions to be provided in the means testing components so that they can access Austudy and youth allowance. It will also allow those new people with exceptional circumstances to get healthcare cards as well. So it is a tremendous bill in terms of supporting people in rural Australia who are doing it tough. Coming from rural and regional Australia and working there all of my life, I do understand that there are people out there doing it tough.

The history of this long drought has been a very long one, and it was great to hear the member for New England speak tonight about some rain. The drought seems to be an act of God. For those listening to the broadcast tonight, the lights have just gone out in Parliament House, so we are standing here in the semidarkness. But I will continue.

Government Member:

It’s mood lighting!

Jim Turnour (Leichhardt, Australian Labor Party) Share this | Link to this | Hansard source

It is mood lighting; that is correct! This has been a very long drought, and there are still 84 areas declared as under exceptional circumstances. Twenty-seven of these have been in continuous declaration for longer than six years.

When I look at maps of the different states in Australia I can see very large areas of Australia that are still declared as under exceptional circumstances. I recognise, as the member for New England has said tonight, that there has been rain falling across the country in places that have not seen it for a long time. The rain in south-east Queensland was great, and dams there have risen to around 40 per cent—that is great news. (Quorum formed) With the lights in the chamber down, I was going to go on and talk about climate change because I think it is a very apt time to talk about it, particularly in terms of talking about drought.

I made the point that there are 84 areas declared as under exceptional circumstances in Australia and 27 of them have been declared for longer than six years. There is no doubt that this drought has been longer and more devastating than many droughts in the past, if not ever. There can be no doubt that climate change has been part of the impact that has brought on this drought. The Australian government’s Bureau of Meteorology statement on its website entitled ‘Long and short-term rainfall deficiencies persist’ says:

The combination of record heat and widespread drought during the past five to ten years over large parts of southern and eastern Australia is without historical precedent and is, at least partly, a result of climate change.

The Bureau of Meteorology is in agreement that climate change has been a major cause of this drought, if not a significant reason that farmers and rural businesses out there are doing it tough. Therefore, it is very important that, although I rise to support this bill tonight and provide support for farmers and small businesses out there in rural Australia, working families doing it tough, we have another look at drought policy. I was pleased that the Minister for Agriculture, Fisheries and Forestry earlier this year announced that the government will be undertaking a comprehensive review of drought policy.

The climate is changing not only in Australia but around the world, and drought is all about the fact that we are not getting enough rain in large parts of Australia. It is extremely important to have another look at the drought policy going forward to make sure that it is providing the support that is needed to rural and regional Australia. I heard the contribution from the member for New England, and I have seen him back in the chamber today talking about zero-till farming and the changes in farming practices that we have seen over the last 10 to 20 years. I support his comments in relation to the need to get more information, more research and more data. There are people out there doing good work in this area in looking at how much carbon is being stored in soils and making sure that is something we can look at in the years ahead as part of any trading scheme. That is certainly something that I have looked to support and to make sure we are getting the right information into the system in relation to, because climate change is real. It is happening.

I know there are some members opposite who are still sceptical about that, but it has been a major reason that we have had an extended period of drought. It is very important that we as the government not only support farmers and small businesses in rural and regional Australia but actually take action to ensure that we are tackling climate change and providing farmers with the support to manage and deal with it into the future. I commend this bill to the House. I strongly support it. Coming from a farming and a rural background, I understand how hard people are doing it out there, how tough it is for working families out in regional Australia. I am proud to be part of the Rudd government that continues the tradition of Labor governments supporting rural and regional Australia.

Sussan Ley (Farrer, Liberal Party, Shadow Minister for Housing) Share this | Link to this | Hansard source

I am pleased to speak to the Farm Household Support Amendment (Additional Drought Assistance Measures) Bill 2008. The member for Calare, the member for New England and others have talked about the measures contained in the bill and the fact that they reflect a decision made by the previous government on 25 September last year to provide an additional $740 million in drought assistance measures. We were very pleased at that stage that, without this legislation actually passing through the House, we could go ahead and changes could take place in our communities and further drought relief could be provided. As the member for Calare put it, it really did take drought relief a step further to an understanding that it does affect not just farmers and agriculturally dependent small businesses but all of the small businesses in a small town. They were able to be provided with relief under this bill.

There were other measures that are actually not reflected in this particular piece of legislation but that were very important at the time. Families benefited from the establishment of 25 family support drought response teams. I think the Minister for Families, Housing, Community Services and Indigenous Affairs has actually announced the additional rollout of those following on from this measure today. Funding for up to 13 additional rural financial counsellors, an additional 10 Centrelink rural support officers and five social workers was also provided at the time. From my point of view, a critical aspect of the package was the grants of up to $20,000 that were made available to irrigators in the Murray-Darling Basin who faced zero water allocations.

The measures we are passing through the House now so many months later certainly remind me, as a local member in the southern Murray-Darling Basin, of the very severe effects that we were facing at the time and that we still continue to face. We find ourselves standing in this place so often talking about drought, and it never really seems to go away. My purpose is not to go over the details of this but to really make an appeal to the Minister for Agriculture, Fisheries and Forestry. He was in the chamber before listening to the earlier part of the debate, and I appreciate that. He is busy, he has a lot of things to do, so it was good that he could be here. But the member for Calare picked up on it when he said that the districts of Bourke and Brewarrina are facing the expiry of their exceptional circumstances declarations in only a couple of weeks and that they have no news about whether those declarations will continue. Although I searched in the budget, I could not find anything that showed an underlying financial commitment to further exceptional circumstances in terms of either relief payments or interest rate subsidies.

But the minister and the government have announced a review of draft policy. My heart sank, I must admit, when I heard about this because I thought, ‘Not another review; not another investigation.’ I do not think this one reports until 2009. The review will include:

• an economic assessment of drought support measures by the Productivity Commission, with terms of reference ...

I think the terms of reference are supposed to be finalised, but I have not seen them anywhere.

• an expert panel, led by an eminent Australian, to assess the social impacts of drought
• the Bureau of Meteorology and CSIRO—

Of course, CSIRO has had its funding cut—

• to undertake a detailed scientific examination of likely future climate patterns and the current Exceptional Circumstances standard of a one-in-20-to-25-year-event.

So we have a review of drought policy, but we have no statements in the budget that indicate continuation of exceptional circumstances. I do appreciate that the minister has said that this review is separate from the exceptional circumstances process. Although automatically one might think there is a bit of a link, he has said there is not. But the point is that we do not need another review. Yesterday, 2 June, his media release said there is to be:

... an expert panel to examine the social impact of drought on farm families and rural communities ... a seven-member panel, to be chaired by AgForce Queensland President Peter Kenny, that will visit rural communities to hear first-hand how the drought has affected families and communities.

Come on! We know how the drought has affected families and communities. Seven very good people have been put forward. One is our colleague the member for Wakelin. They will all do a fabulous job, but I have the social committee in place, I would like to tell the minister. I have the network and so do all of my rural colleagues, and we have been telling this House for a long time now about the social impacts of the drought.

I have had a note from rural financial counsellors in the Hay area of my electorate. It was not in connection with this bill; it was just in terms of keeping me up to date from time to time. I would like to read for the Hansard record what has been described by one of the financial counsellors as the social impact of the drought on the Hay district.

In Hay, the occupancy rate of rental accommodation is normally 95 per cent. It is running at 80 per cent. I would attribute the significant downturn to the drought, stock numbers being so low and there is very little action on the cropping side of things. The local feed lot, which employed a hundred people just five years ago, has now three people employed. Additionally, some of the lettuce industry has shifted its operations to Warrnambool where there is a more reliable water supply. Real estate agents in the area are commenting that there is very little interest in homes and that sellers are having to drop up to 20 per cent of the value of homes to try and move them. Businesses’ running accounts are finding their levels of debt rising, with one local supermarket owed more than $200,000 in outstanding accounts. There are more and more farmers living alone during the week while their wives work in town and try to make ends meet. One farmer 40 kilometres north of Ivanhoe told me that 10 years ago there were 12 families living along the Baden Park Road and now there are only two. Another farmer near Lake Mungo told me that he can count 45 homes within 50 kilometres of his property that are now empty and that had families living in them over the last 15 years.

That is just one paragraph about one regional area of Australia. I repeat my request to the minister: please do not waste any more time studying the social impacts of the drought. We know very well what they are.

I have also had some communications on the effect on producers if exceptional circumstances help were discontinued. The local rural financial counsellors in the Hay area in the Murrumbidgee have approximately 400 producers on their books with an average debt of between $600,000 and $700,000, which has been increasing by approximately $100,000 a year. It is the counsellors’ estimate that up to 50 per cent may be forced off the land if the assistance available through EC were to be discontinued.

A report commissioned by the New South Wales opposition shows an increase in the number of bankruptcies in the Riverina:

The report shows there has been a 10 per cent increase in bankruptcies state-wide.

In the Riverina, several towns have also shown an increase.

Berrigan had no bankruptcies last year but eight have been recorded this year.

Yanco has jumped from zero in 2007 to six this year, Temora has increased from one to six, and Lockhart recorded four bankruptcies this year, up from one last year.

Jerilderie recorded three in 2008 after having none the year before and Wyalong had an increase of seven, up from two bankruptcies.

The state government has been challenged for failing to realise the severity and intensity of the problem, and I note that the fair trading minister, Linda Burney, says the New South Wales government is aware of the problem and is boosting the number of financial counsellors available. Well, that is not really what is required. What is required is for this government—and this agriculture minister to persuade his cabinet, if that is what it takes—to continue the exceptional circumstances help that has kept our farming families and our rural communities afloat. I know it has been a long time and I know it has been a drain on taxpayer dollars, but it is extremely necessary because we cannot face a situation where up to half of the people receiving exceptional circumstances help go onto those bankruptcy lists. It is not good enough that the member for Calare has constituents who are now two weeks from the end of their EC declaration and do not know what the future holds. The National Rural Advisory Committee has the task of independently assessing these areas. I would have liked to ask the minister, had he been here: has the committee received any instructions as to changing its guidelines to assess whether areas are entitled to continue to receive EC declarations? If that is the case, that is an escape clause for the government.

I see in the budget a $14 million transition fund directed to the welfare of farmers, and that also worries me because it says that, if we are easing people out of exceptional circumstances, there may need to be a transition fund that can help manage that process. Well, of course, it is hopelessly inadequate, and we do not want to ease people out of receiving exceptional circumstances; we want to support them where they are. We want them to contribute to the food security of the world—a very popular topic at the moment and one that is extremely meaningful for farmers. I thank the House.

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

The Farm Household Support Amendment (Additional Drought Assistance Measures) Bill 2008 is important for Australian farmers, for small business operators in rural towns and for my seat of Corangamite. Whilst only a small proportion of my region has been declared to be in exceptional circumstances, it is significant that it is the sort of country Australians normally associate with drought stricken circumstances. In fact, much of the farming country in my electorate has always been particularly productive. It is a measure of climate change, and of the changing circumstances that lie ahead for our farming community, that some of the region is now in this category. This is why it is important. All farmers in the region can see change and they want to know that there is support for them. That is important for our local farmers and small business operators in the regional areas of Corangamite. This bill gives some peace of mind and improved future financial security for a very important group of Australians: the group of Australians that work so hard to put food and drink on our tables and to help significantly with our exports and balance of payments.

The Farm Household Support Amendment (Additional Drought Assistance Measures) Bill 2008 provides legal authority for changes to drought assistance measures which were introduced in 2007. This bill broadens eligibility criteria to allow more small business operators in small rural towns affected by drought to access exceptional circumstances relief payments. In this bill, we are also increasing the maximum allowable exempt off-farm non-business income for exceptional circumstances receipt payment income test. As well, the bill aligns payment more closely with mainstream welfare programs. It does this, for example, by removing the eligibility requirement that recipients be in Australia in order to receive the payment, aligning it to that which applies to recipients of Newstart allowance. This bill also seeks to amend the Social Security Act 1991 to make sure the new category of small business operators, as well as newly eligible farmers, will be able to access concessions under the youth allowance and Austudy means tests and to have access to the healthcare card.

This bill has been fully costed and budgeted for. Costing of these changes was agreed to by the former government, with our bipartisan support, as an $85 million budget measure. I want to make one thing clear about this bill, and I am pleased to be able to say it: this has been a totally bipartisan initiative, with both major parties agreeing to the measures and costings. I think we are aware of how important the farming sector is. I think we are all aware that we must make the farming industry more efficient, but we must also support it during difficult times. I do not think there would be one individual in this parliament who would like to see Australia lose its food industry. I do not think even the harshest, flat earth, laissez-faire free marketeers on the other side of this chamber would stand by and let Australian farmers perish and let the industry be shipped offshore. Well, there might be one or two over there.

In my electorate of Corangamite, farmers and the farming industry play a vital role. Thousands of local people are employed in farming and agriculture in Corangamite. Thousands of local families depend on farming income. And our region has not been immune to climate change. Recently, Minister Burke visited my region of Corangamite. On that trip, we visited some dairy farms. Despite those farms being viable farms within the same family for many generations, many for the first time were accessing government assistance. I know a number of farmers who were very relieved just a few weeks ago when some important rain came at about the right time. They will soon need more. In our neck of the woods, the rains are not coming as frequently as they once did or with the same intensity.

This bill will help protect this industry in Australia and help many families who depend on it. Targeted safety net income support and auxiliary benefits will help rural families in hardship as a result of this ongoing drought. Measures are focused specifically on drought affected rural and regional communities and individuals within rural and regional communities.

Exceptional circumstances assistance payment remains the government’s primary mechanism for providing support to drought affected farmers and dependent small business operators in rural areas. The exceptional circumstances assistance payment is one of the main assistance measures, providing targeted safety net income support to eligible farmers and small business operators under the Farm Household Support Act 1992. Payments are similar to other welfare support arrangements such as Newstart allowance, although some specific eligibility criteria exist for farmers and small business operators to take into account their different circumstances.

Ancillary benefits, such as a healthcare card, are available to recipients of legislated welfare assistance payments, including those in receipt of exceptional circumstances payments. Centrelink automatically issues exceptional circumstances recipients with a healthcare card, in addition to the Austudy and youth allowance payments received by the children of recipients, which I think is a fantastic thing.

I see a couple of aspects in this detail that need some drawing out, as they are very important. Firstly, the issue of healthcare cards. My experience is that farmers are generally a hardy, self-reliant and resilient group of people. In tough times of drought and financial hardship people often go without and are sometimes tempted to run the gauntlet by not getting the health care they need. Sometimes they might do it by cutting back on the extras their kids need. Again, this is not an acceptable set of circumstances. A healthcare card in these circumstances can be a huge help. Medicines are often a big cost if someone gets sick and a healthcare card will certainly help with that. It is absolutely essential that farming families’ health is looked after during the hard times. It is essential that the children and dependents of farmers are not punished due to drought and the vagaries of the weather.

We have to look after kids as a priority—whether they are from the city, a regional town or a farm—and nothing is more important than a kid’s education. Providing better access to Austudy and youth allowance is often vital in ensuring farm kids get the education they need. That is a very important benefit which this bill is helping people access.

I am very pleased to speak on this bill. Certainly, it will put in place the legal mechanisms required to support the bipartisan approach taken in September last year, a bipartisan approach which I think is very commendable. It certainly builds on the commitments that the then Hawke government made back in the early nineties to provide real assistance to farming families which were being affected by drought. I commend the bill to the House.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

I want to pay a very fine tribute to the Minister for Agriculture, Fisheries and Forestry. When I first discussed with him the Farm Household Support Amendment (Additional Drought Assistance Measures) Bill 2008, he said, ‘I’m from the city.’ I said, ‘That’s not a drawback here. To come in with clean paper is probably a good thing not a bad thing.’ In every debate, the minister has been in the House. In the state house in Queensland, the minister was always in the house for his legislation. We could speak to the minister and he could get a perspective on what was going on. It has appalled me in this place that ministers do not come into the House. Rather than condemn ministers for not coming into the House, three people from this side have come over to me tonight and said, ‘Isn’t it good, Burkey being in the House?’ We commend and thank the minister for that.

Minister, a lot of people would tell you that this is the worst drought in Australian history. Reading the history of the honourable member for Maribyrnong’s electorate—he was on the AWU—and reading that very fine book about the AWU, I was surprised to find out the extent of the drought which started in 1884. With one short break, it extended all the way to 1914 and was referred to as the ‘Federation drought’. This was nothing to do with carbon dioxide. If it was, they must have had terrible carbon dioxide problems back in the 1880s.

Our country is prone to droughts but the northern half of Australia is not. My family live at the headwaters of the Cloncurry River where they have lived for close to 120 years. Even though it is 600 kilometres from the sea, every single year that river has run. In Northern Australia, we have security of supply of water. As a person who owned a quarter of a million acres of Australia and half a million acres on another occasion, I can see that it does not reflect upon us well that we have not used this water up to date as graziers. The reasons for that are not entirely the fault of the cattlemen. For the last 15 years we have, in fact, been told by the Queensland government that we are not allowed to take any water out of these rivers. This is extraordinary legislation. You have a river that runs 400,000 megalitres a year past your doorstep at Cloncurry and six million megalitres a year at Normanton at its mouth, and you are told you are not allowed to take any water out of it!

The whole Murray-Darling system has only 20 million megalitres. The Gilbert River has nearly 10 million megalitres by itself. The Upper Burdekin has 10 million megalitres. There are something like 20 or 30 rivers in the Gulf Country and just two of them have more water than the whole Murray-Darling system. We know that those rivers are going to run every year, so all we are asking for is the right to take some of the water to put it on the ground. Let me explain that to the House.

We went into very great detail on our station property and costed it out, and there are some stations doing that now. If we could take out enough water to do 40 hectares, which was really all we needed, in a good year we would put our weaners onto the 40 hectares and fatten them, which meant a doubling of my net income—not a doubling of my gross income but a doubling of my net income. In a bad year, we would sell the weaners off to somewhere else in Australia and we would put our breeders onto those 40 hectares. It would be better if it were 60 or 100 hectares, but that is all we needed, that tiny amount of water. It may be 10 megalitres a hectare and, let us say, 100 hectares; that is 1,000 megalitres. At Cloncurry, 600 kilometres from the mouth of the Flinders River, we have 400,000 megalitres flowing past. All I wanted for my station was 1,000 megalitres. Almost all of the stations in the gulf can be drought-proofed. One of the reasons that we have not been able to do that is lack of finance. We have to go to a bank and borrow money. In our case we had to borrow money to do something like 300 or 400 kilometres of fencing. We had to put waters in. The best use of money is to put water down so cattle can drink and that area can be brought under production. Cattle can walk only five or 10 kilometres.

The honourable member for Leichhardt and the honourable member for New England mentioned carbon in the soil. I did not realise this until about four months ago. It took me many, many years to understand that Australia has only one-fifth of the carbon levels that we should have. When we have those carbon levels in the soil, we do not need anywhere near as much water. There is something like a 20 per cent retention in the ground, so the grass will grow for a fifth of the year longer. That is very important to us. Whilst we have this massive water supply in Northern Australia, it is only there for three months—hence, the necessity for dams and weirs so that we can extend the flow in the river to enable us to get at it. We can drought proof.

The very famous Freddie Tritton, one of the great pioneers of agriculture in Australia, and his son, Corby Tritton, who was right at his side even as a little kid, built such drought proofing at Richmond. We hope that the minister can come up and visit us at Richmond, where we have a project. You can see what this wonderful pioneering family have done. They have been able to go year in and year out without worrying about droughts, because the Flinders River, similarly at Richmond, runs nearly every year. It is not quite as good as at Cloncurry. They were able to put forage sorghum in the ground and they have been able to have silage to carry them through those years. Sir Graham McCamley—the greatest cattleman the country has ever seen—pioneered the Brahman breed in Australia. If we did not have pure Brahmans on our property the cattle would just die late in the year; we just could not keep them alive. That is the importance of the Brahman breed, particularly to the northern half of Australia.

We will have discussions with the minister for agriculture. We have already had discussions with the Minister for Resources and Energy about the Pentarco project. At Pentland we have a power station proposal that will have zero emissions. It is a front-end technology, but the back-end technology is very relevant to what we are talking about here. They are going to put the carbon dioxide into sugar cane and, ultimately, into ethanol. It is a very big irrigation project because we need a very large area to absorb eight million tonnes of CO2 from a power station. The minister will be interested to know that, when you put bacteria in the ground, it will take that carbon, put it into the ground and resuscitate tired ground. I presume a lot of that carbon deficiency comes from our First Australians who did firestick farming and we later Australians who did firestick mustering on our station properties. That is one of the contributing factors to the very low carbon levels in Australia. As the member for Leichhardt and the member for New England, who are better informed than I, spoke about, restoring those carbon levels makes a hell of a difference to the ability of the soil to hold onto that moisture. It will be able to hold onto that moisture for 20 per cent longer. BHP Billiton has done trials in Townsville. I would have thought the idea of just putting carbon dioxide on the ground and it being absorbed into a plant was Disneyland, but it has already been done. JCU and 15 other sites throughout the world have done it. When they released the carbon dioxide, they had 36 per cent greater production of pasture—just native, natural grasses. At sites in other parts of the world they have had up to a 44 per cent increase.

A very good friend of mine—a lady whom God had made quite handsome, I suppose—is a young mother with three children. During the last drought I asked her to tell me what it was like for her in the mid-west plains country, where I come from—the flat country in north-west Queensland, the rolling black plains. I am sure that when Banjo Paterson coined the phrase ‘the everlasting sameness of the never-ending plain’ he was at Winton, which is on the great inland plain of Queensland that stretches for 1,200 kilometres from Barcaldine—home of the Tree of Knowledge where the Labor Party was founded—all the way up to the Gulf of Carpentaria. On Monday morning, she would get up at 3.30 so that she could be ready to leave with the three kids to drive to Charters Towers—because that was the only place where she could get a job. It was nearly 400 kilometres away. She drove for four hours so that she could get to work at half past eight and have the kids in school. On Friday night she packed up and drove four hours back home again with the three kids. Then she worked on the station at the weekend—because it is hard to run a cattle station with only one person. Almost every job requires two people, and they could not afford to employ someone. Her husband chose to stay at home on the station. Some would criticise him for doing that. All of the neighbours worked. One of the neighbours worked in my office. His brother was out driving an old second-hand grader they had on the station, which they hired out to do a bit of work, just to stay alive. Another one of them went fettling on the railways. Another one was out selling Amway. These are not people that sat on their tailbones or stood on their pride or were arrogant. They went out and did fairly humble jobs. Some people would regard selling Amway as a humble job, but they went out and did those things. They did whatever they had to do to survive. So we very much appreciate some relaxation of the income testing.

It is important for me to tell the House that Babinda is one of the very few sugar areas in Australia where there is no debt. They are all little farms. They tell you, ‘If you get big, you’ll be profitable,’ but these are only little fellas. But because they are little fellas they have to get a job, so most of them work in the mills or on haul-out bins. Most of them have union tickets. But they survive because they have the income from the wage working in the sugar mill as well as their income from the farm. When we run into hard times we need this.

Looking back on it, I came from a very wise government. The history books will be very kind to the Bjelke-Petersen government, as was the last Labor Premier. He attributed the existence of the Australian coal industry and the Australian tourism industry to his political opponent Bjelke-Petersen, which was very generous of him but also very truthful. He should have added, of course, the aluminium industry. In our wisdom as a government, we decided to set up a development bank—as the great King O’Malley did, as the great Ted Theodore did and as the great John Curtin and Ben Chifley did. All of them enhanced, developed and established a development bank, as did Premier Playford, Premier Bolte, Western Australian Premier Charles Court and Bjelke-Petersen.

The logic behind a development bank is that, if you have long-term profitability—and we do not want to prop up an industry that does not have long-term profitability—we ask the government to help us through the bad times. What happens in bad times? I use myself as an example. Whilst interest rates were running along at about 16 or 17 per cent, we had added 2½ per cent imposition because we were in the cattle industry. Then we had added another 2½ per cent because we were in an at-risk area, so that was five per cent on top of the 17, and I was up to 22. Then, because I was an at-risk farmer, I had added another three per cent to that—and then there were bank charges. And I do not profess to be a cattleman; I was a businessman who had cattle. In our second-final year on St Francis we paid 29 per cent interest. But what should happen to these people? And I do not mean people like me—I was a businessman with cattle; that is fine for me. My neighbours were people who lived 300 kilometres from the nearest town, which was Croydon, with 120 people in it. For these great pioneers who stand on the ramparts of our country, surely when the bad times come the government can loan them money.

It did not cost the government of Queensland anything. We made indecent profits out of the state bank, which was called the QIDC. I was the primary minister responsible for the QIDC, so I speak with authority. We took $200 million out of an ag bank account, as it was called, and turned that into a bank. It was sold, I am ashamed to say. The National Party government, I suppose, predictably sold the bank, though not the same government that was there in the Bjelke-Petersen days, I can assure you. The Borbidge government sold the bank for $3.5 thousand million. So we started with $200 million; we sold it for $3.5 thousand million. But when the next drought came along there was no bank there to carry us through.

Mr Deputy Speaker, you understand that, even if we only take $40 million a year in help, if that subsidises an interest rate, it enables the cattle industry to borrow $1,000 million and provide interest rates of about four per cent. In the last sugar crisis that enabled everybody to get through.

But do not think we were without our globalisers and free marketeers. The head of the bank told me as the primary minister responsible that he had to let a third of the sugar industry go. I pointed out to him that our prices were cyclical. I was getting nowhere, so I saw him the next day—I went to him; he did not come to me—and I showed him the graph. I said to him, ‘We’re going to look pretty stupid if we wipe out a third of this industry and we’re at the top of the graph next year.’ He said, ‘Oh, you don’t understand it. It’s beet sugar from Europe.’ I said, ‘Beet sugar collapsed the industry in 1898. Please, don’t tell me about the sugar industry.’ Anyway, within a week we sacked him, which made a lot of waves at the time. Eight months after that conversation took place, the price of sugar had trebled.

But I have to say in all honesty that I would not take that decision today because, whilst the cycle is still there, the cycle is low now because Brazil has ethanol, which means the long-term average price has dropped by about 30 or 40 per cent and Australia cannot live with that long-term average price. Whilst we had long-term viability a development bank would carry a long-term viable industry through that period.

What the minister has to contend with here is that he has inherited the responsibility for agriculture in this country. When they deregulated the dairy industry, I said, ‘Within 10 years this country will be a net importer of food.’ I regretted having said it because I meant 10 years metaphorically. So I went out and faced the music. I very seldom quote a figure, but I did mean a metaphorical figure. But I found out that I was wrong—it was not 10 years; it was nine years. Within nine years this country would be a net importer of food.

I happen to be a Christian believer. The gospel book tells about people who are given talents. One bloke went out and hid the talent under a rock, another bloke was worried that he would lose it and another bloke went out and did what he should with it, used it and multiplied it. We have been given great talents by the good Lord; we have been given 300 million megalitres of water a year in North Queensland. Remember that the Murray-Darling, which produces half our agriculture, only has 20 million megalitres, but we in Northern Australia have 300 million megalitres. We are using about two million megalitres of that—that is all. The great Ted Theodore came down to this place to build dams and railway lines across Northern Australia. He got no sense out of the Australian government, so he said, ‘Damn, I’ll come down here and take it over,’ which is exactly what he did—a great man of Australia and a dominant figure in Australian history.

The other problem we have is that we went and free-traded—a great idea if somebody else was doing it. You can get the OECD Agricultural Outlook document—I have the latest document from the year before last—and it shows the total support estimates are 49 per cent. That means that one-third of the income of all the farmers in the world that export is coming from the government via tariffs or subsidies. They get a 49 per cent tariff subsidy and we get six per cent, which is virtually nothing. Most of that was from the dairy and sugar levies. When they are removed, I suppose it will be down to about three or four per cent. We cannot possibly survive giving our competitive farmers that sort of figure.

The Americans pay $172 for their grain; Australians pay $300. They have dried distillers grain from methanol. They can produce cheap food; we cannot. (Time expired)

Sharman Stone (Murray, Liberal Party, Shadow Minister for Environment, Heritage, the Arts and Indigenous Affairs) Share this | Link to this | Hansard source

I rise tonight to wholeheartedly support the Farm Household Support Amendment (Additional Drought Assistance Measures) Bill 2008. This bill carries on the work initiated by the Howard government to provide support to Australia’s farm communities as they continue to battle the worst drought on record. I am particularly relieved to hear that the Minister for Agriculture, Fisheries and Forestry is continuing the program of support through exceptional circumstances payments for drought stressed communities. My electorate of Murray has not seen decent rains for some five years now, and an extraordinary degree of family distress and real economic contraction exists right across the electorate.

I was not convinced that this government would continue exceptional circumstances payments. This government has shown a callous disregard for the plight of rural communities. It slashed the funding for critically important programs like Landcare and for the catchment management bodies by 20 per cent and 40 per cent respectively. It cancelled funds for the Howard government’s very important environmental services program, which was designed to give farmers a way to be paid for the environmental work they did as a by-product for sustaining their farmland and producing food and fibre. That program disappeared with the announcement of this year’s Rudd budget. So I was relieved to see the budget contain ongoing support for our drought ravaged farmers through exceptional circumstances. As I say, it was touch and go.

This bill amends the Farm Household Support Act to help more small rural businesses, which are suffering a downturn because of the drought, access relief payments. This supports not only rural business but also the communities that rely on them. The bill will increase the income exemption for the exceptional circumstances relief payments income test from $10,000 to $20,000. This effectively doubles the amount of off-farm or non-business salary and wages that farmers and small business operators can earn without reducing their payment. This recognises that during this prolonged drought many farmers have had to seek some off-farm income to keep their business viable—that is, if there is local employment. The education and welfare of young rural Australians is also vital for the economic prosperity of their own regional economies and for the country as a whole. By amending the Social Security Act 1991, this bill will provide concessions under the Austudy and youth allowance means tests for newly eligible recipients of the exceptional circumstances relief payments. It will also ensure that all newly eligible recipients receive a healthcare card.

The bill will amend the eligibility criteria to extend exceptional circumstances assistance to more small business operators, as I began by saying. These small operators must be located in towns that have a population of 10,000 or less—and there are 52 of these towns in the Murray electorate alone. They of course will get assistance, provided they can demonstrate that they have had a downturn in income as a result of the drought. They do not have to be a farm dependent business; they can be a butcher, a baker or a hairdresser. If the town has a population of over 10,000 people then exceptional circumstances may also still be paid if businesses can demonstrate a downturn in business—but they do have to have a dependence on farm related enterprise. I commend the bill. It is a very worthwhile and humane measure which tries to support our drought ravaged farmers.

Today 2,000 people from northern Victoria, the vast majority of them dependent on exceptional circumstances assistance, left their drought ravaged farms and businesses to march on Melbourne. Why, you might ask, given the huge costs of their vehicle fuel and the time and effort involved, would they make this five- to eight-hour return journey to the steps of Parliament House in Melbourne and then turn back again up north as evening fell? They came and they protested and they begged the Brumby government to give them a chance to continue to produce food for the state and for export markets. We know there is a global food shortage bearing down upon many countries right now. Like all farm communities, these marching men and women’s food production capacity depends on their water security. In the past when drought struck, as it often does in Northern Australia and up through the Murray-Darling Basin, these farmers were secured by the Goulburn Murray Irrigation System. It is a century-old masterpiece of engineering that combines the natural waterways with thousands of kilometres of earthen channels. The system moves water from the Eildon Dam across thousands of hectares of farmland to where, finally, the irrigation system empties into the environmental flows of the Murray River. Over $2 billion worth of food annually could be, and usually was, grown out of this system—that is, when the water flowed.

Unfortunately, the Brumby state government is hell-bent on creating a permanently droughted state for the food bowl of northern Victoria. The Victorian government aims to pipe the water away, out of the Murray-Darling Basin, across the divide to Melbourne and Geelong and also to Bendigo and Ballarat. The pipes to Ballarat and Bendigo are already in place. There was a great celebration the other day about the water pouring out into Ballarat, a region of 42-inch rainfall. Of course, the water had come from an area of 15-inch rainfall. How extraordinary! The water had come out of the last dregs of Eildon Dam, which is reduced to less than 13 per cent storage. It was water that otherwise would have been piped to the farms of northern Victoria to produce dairy product, fruit, prime meat and crops for consumption. Now another even bigger pipe is to be pushed through to supply Melbourne and Geelong. Why do Melbourne and Geelong need this water out of the failing Eildon Dam from the food producers of northern Victoria? It is because the cities of Melbourne and Geelong do not recycle and do not harvest their stormwater, unlike other great cities of the world. They have been failed by generations of state governments.

To drought proof Melbourne, Geelong, Bendigo and Ballarat, a permanent artificial drought is to be created in what was the food bowl for Australia: northern Victoria. How can Premier Brumby get away with this? This advertisement that I am holding says it all. It was placed in the major Melbourne papers today to coincide with the farmers’ march. It says, ‘We the Victorian government are going to put about $1 billion into fixing up the irrigation infrastructure we own as the government in northern Victoria. We will find that a lot of water will be saved through this process, and that water can go to Melbourne, or a big proportion of it.’ The trouble is, this claim is based on false information and, as well, the wrong values and principles.

It is claimed that there will be a modernisation of the irrigation system and over 400 billion litres—that is, 400 gigalitres of water a year—will be saved and found. The government in Victoria has claimed that 900 gigalitres are lost out of this irrigation system each year. This has been the claim all along from the Premier, but their own Department of Sustainability and Environment published a lower figure of only 650 gigalitres lost. This year, the measured losses of the Goulburn-Murray system were only 450 gigalitres. Let’s pretend we could have saved half of that with a miraculous re-engineering of the system—and no system could ever be expected to save half of the losses—and these savings were redistributed to Melbourne. That would have taken 30 per cent of all water available to irrigators to Melbourne—30 per cent of all water, which otherwise would have led to food production, being flushed down the toilets of Melbourne. This is an absolute obscenity.

We are a country that must make sure that our cities are not climate dependent when it comes to their water supplies. We must not fudge the figures and pretend that you can make new water from simply re-metering—changing from dethridge wheels to a different device. All that does is change the measurement of water from one person’s ledger to another. You cannot pretend to save an enormous amount of water for the environment by total channel control. What that does is collect up water that had once escaped to the environment and turn it into some other purpose. The only way you can really make sure you have additional water for the environment is to have on farm water use efficiency combined with something like piping and the sealing of things like earthen channels.

Unfortunately the Rudd government has decided to disappear—at least the $2 billion that the Howard government put on the table through the Murray-Darling Basin $10 billion, 10-point plan for on farm water use efficiency. That fund has disappeared. Instead, we have been given, first of all, $50 million to buy back water from people like my northern Victorian irrigators, who have the banks leaning on them saying, ‘It is sell your water, or else.’ That is not a willing seller.

We are now told that there is an extra $2 billion to $3 billion to buy more water off these drought ravaged farmers, who are so stressed they cannot say ‘no’ to their banks. Under our $10 billion, 10-point plan—the coalition’s plan—we said, ‘Yes, we will target buy-back from the overallocated systems, which are largely in New South Wales.’ That way we would have sorted out a very serious problem, in particular for their rivers and streams, created by the New South Wales government overallocating water several generations ago.

Today we have a situation where a permanent drought will be created—in terms of water security—in northern Victoria by the Victorian Labor government, which has a callous disregard for food production for this nation. It has alternatives in Melbourne with recycling, with harvesting stormwater, with a desalinisation plant or indeed it can look to new dams in Gippsland, which regularly suffers the ravages of flood. They have to be looked at as alternatives. Geelong has close by one of the most prolific groundwater systems in Australia. All of that is ignored because of the cheap, technologically simple task of pushing a pipeline from the failing Eildon Dam across the range to Melbourne—because it can be done by the next election.

I am so concerned about the future of food production right across Australia, but particularly in northern Victoria. There is a simple solution to the dilemma we have right now. That is, improve on farm water use efficiency, with government support. We had the measures in place. I ask the Rudd government to bring back those measures. Please do that, because the future for all of us is dependent on water security and on being able to feed ourselves. It is about a fair go for all.

Mr Tony Burke (Watson, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

in reply—May I thank all members who contributed to the debate. I think it is important to acknowledge, as I acknowledged in my remarks on Thursday when I moved that the bill be read a second time, that the idea of the Farm Household Support Amendment (Additional Drought Assistance Measures) Bill 2008 is one that began before the change of government, and it was given bipartisan support by us when we were in opposition. The payments have already commenced being made to the people affected, but the legislative basis for those payments is yet to be made, although hopefully in a few moments we will be a little bit further along that path.

Some very serious issues were raised by the member for Calare while I was here in the chamber, and by the member for Farrer—I was outside of the chamber but managed to catch a good deal of her speech from my office. They each referred to some of the EC areas that are coming up for renewal. They are right to raise the concern about the genuine need of people to be given certainty as early as possible. That has been taken on board. In private conversations with the member for Calare I have explained to him my determination to act as quickly as possible on that.

I should inform the House that the process for all renewals and reassessment of EC areas is unchanged from what happened under the previous government. The members of the National Rural Advisory Council who make the recommendations to me are all people who were appointees of the previous government, doing the same work that was being done under the previous government. There is always a tension here, I would remind the House, between the desire to make sure that we give people certainty as early as possible and to leave the NRAC assessment to late enough in the piece so that they can make as accurate an assessment as possible. I would hate to think that we had NRAC do their surveys so early that people were then recommended to come out of exceptional circumstances assistance when, by the time the date has actually ticked over, had the assessment been made later they would have been made eligible. So there is a tension there in sorting that out, but I want to assure the House that within those parameters we are acting to give certainty to people at the earliest possible opportunity. With that in mind, I commend the bill to the House.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.