Kay Hull (Riverina, National Party) Share this | Link to this | Hansard source

—I move:

That the House:

(1)

recognise the seriousness of the drought situation across rural Australia; and

(2)

calls on the Government to:

(a)

recognise the need for long term commitment for Exceptional Circumstances (EC) declared areas, and to provide continued support to allow those areas to fully recover from the drought;

(b)

look at the history of EC declared areas and the direct correlation between longevity of declaration and hardship inflicted;

(c)

commit to the extension of support programs to allow those areas to fully recover regardless of meeting current EC requirements; and

(d)

extend EC assistance to all rural based businesses who meet the criteria.

I have put this motion together in a very precise and concise way. It is no secret that we have had a significant ongoing drought right across many areas of Australia, none more so than in my electorate of Riverina. My concern and the reason for putting this private members’ business to the House is to alert the minister that there is a need for some dramatic and drastic urgent changes to be made to our current EC policy. Whilst I recognise that there is a transitional phase—transitional income support—when people are coming out of drought, I do not believe that it adequately covers the requirements that the many farmers and businesses will require to move themselves forward as a result of this ongoing drought.

The process is that you have regional stress, you lobby the state government and you then put in an application for EC. Then of course comes the issue of having to collect the meteorological data. The proponent collates and analyses the meteorological data with respect to EC meteorological criteria. That is the problem. There is and will be many areas that may have experienced recent rains that may not in fact meet these EC meteorological criteria, but it is a fact that many businesses and farmers will not be able to continue if they are not able to access a continuation of income support and interest rate subsidy. I look at all those small businesses in rural communities and I look at the 9 October press release from the minister, the Hon. Tony Burke, that says:

Many farm businesses have significantly increased the debt they are carrying, as the drought has dragged on.

The drought saw average farm debt in Australia grow from $238,000 per farm in 2001-02 to around $702,000 per farm in 2006-07.

The minister goes on to say:

Interest rate relief on farm debt will provide a significant boost after many years of financial pressure.

I just tell the minister this: there is no interest rate relief for our farmers; there is no interest rate relief for our small businesses. In fact the interest rate relief that was announced last week only applied to homeowners. It has not applied to these farming families. There has been no relief for these farming families. So it is very timely that I place this motion on the record in order to raise the plight of those people who are desperately trying to ensure their future progress, but they require the support of the government to do so.

When you have a full EC assessment NRAC conducts a comprehensive assessment of all the meteorological rarity, the impact on production and the downturn in income. Under EC criteria in the past there have been fewer than two crop losses in a row in most cases. Here we have extenuating circumstances where we are seeing three crop losses, four crop losses and five crop losses in a row. These are circumstances that were never envisaged under the old EC program, under the old EC criteria.

I urge the minister to urgently look at the recovery phase for businesses, community members and farming families in rural and regional Australia that have been affected by drought and who may be coming out of EC declaration, to ensure that they will have ongoing support so that they can meet the demands of the future for food production in Australia but also to ensure that they have their entitlement to enable them to live and work in rural and regional areas. This is an urgent cry for assistance to ensure ongoing drought relief past that available under normal circumstances of an EC declaration and to make changes to effect that.

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

Is the motion seconded?

Darren Chester (Gippsland, National Party) Share this | Link to this | Hansard source

I second the motion and reserve my right to speak.

Chris Trevor (Flynn, Australian Labor Party) Share this | Link to this | Hansard source

Let me begin by saying that the Rudd Labor government recognises the seriousness of the drought situation across rural Australia. The Rudd Labor government has a very able and well-liked Minister for Agriculture, Fisheries and Forestry. His first priority was to visit and meet with the people of rural Australia to see firsthand and to hear directly about people’s experiences, their views and ideas. I am told he has seen and heard of, just as I have as the federal member for Flynn, a drought unprecedented in duration and whose effects are profound and lasting. He has seen, as I have as the federal member for Flynn, cattle struggling, pastures depleted and shallow and dry dams and river beds. He has, as I have, met distressed farmers trying to make important business decisions under stress and still considering the range of needs of their families. He has witnessed, as I have, resilience and great hope.

The Rudd government recognises that drought and climate change are the greatest challenges facing rural Australia. The Rudd government is determined to assist our farmers to build even more competitive, productive and sustainable agricultural industries. The government is looking at how we can help farmers and their families do this. That is why, on 23 April, the minister, Tony Burke, announced a comprehensive review of drought policy to determine the best policy for managing drought in the context of a changing climate. Our approach in this review is to comprehensively examine all the aspects of drought, including the climate scenarios we will most likely face, the social impacts—which are all too often forgotten—and the economic issues involved. A final report is expected to be delivered to the government in February. We thank everyone who took the time to provide submissions or to meet with the expert social panel headed by chairman Peter Kenny, a great ambassador and advocate for the bush.

A concern many farmers have raised with both the minister and me in my electorate of Flynn is the issue of lines on a map. This is one of the critical elements of drought policy which the government believes needs careful consideration. The current system allows neighbouring farms with identical needs to see one farm receiving assistance while the other receives nothing. We believe that we can do better, and we are examining this model in detail. The minister is to be commended for his dedicated work in this area.

It is important to reiterate tonight that the drought policy review will not affect anyone receiving assistance in a current exceptional circumstances declared area. This review is about preparing for the next drought. The government will not be walking away from farmers in difficulty. The Australian government will continue to support those farmers and businesses in need in current EC declared areas.

The government has also recently announced the extension of EC declarations for 33 areas that were due to expire on 30 September 2008. When the Rudd Labor government was elected, one of its first priorities was to visit and meet with people of rural Australia to see firsthand and to hear directly about people’s experiences, their views and ideas. Drought policy was initially based on a model of a one in 20- to 25-year event and EC assistance was supposed to be short term. Due to the length of the current drought, some areas have been exceptional circumstances declared for many years. For example, some areas in Queensland have been declared EC for eight years, and well over half of New South Wales has been EC declared for at least five years. When some areas of Australia have been in EC for eight years something just does not seem right. There needs to be a policy change. In recognition of this, the Rudd Labor government has commenced a national review of drought policy to determine the best policy for managing drought in the context of a changing climate. Current policy is not suitable in a changing climate.

We need to prepare for drought in the way we farm and the way we manage our farm businesses. That is why, on 23 April this year, the government announced a comprehensive review of drought policy to determine the best policy for managing drought in the context of a changing climate. The government does not want to pre-empt the findings of the drought review but it will present the government with options to improve drought policy so that it helps farmers adapt and respond to the effects of a changing climate. I applaud the fine work Minister Tony Burke is doing in this portfolio.

Darren Chester (Gippsland, National Party) Share this | Link to this | Hansard source

I rise to speak in support of the motion and, in doing so, seek to highlight the extremely difficult conditions facing many Australian farming families and their communities. I deliberately refer to ‘farming families and their communities’ because, when a drought hits regional Australia, it hits us all, from those on the front line in our nation’s diverse farming enterprises to the small businesses which supply them, to the teachers, doctors and health professionals who often deal with the social consequences and to the families themselves. Quite apart from the obvious economic impacts which other members have spoken about tonight, droughts are insidious as they sap the energy and enthusiasm of our farming families and communities and corrode the hopes of the next generation.

This motion calls on the government to recognise the need for a long-term commitment to exceptional circumstances funding declared areas and to provide continued support to allow those areas to fully recover from the drought. It is timely that I speak today on behalf of the people of Gippsland who have recently seen the inadequacy of the current EC system, as I have mentioned once or twice before in this House. While I am pleased to report that there has been a breakthrough in Gippsland and the EC funding has been extended until next April, I stand here today firstly to apologise to the Gippsland farming families for the unnecessary and additional stress and hardship that they have been exposed to in recent weeks. I am sorry that the system failed them when the National Rural Advisory Council and both the state and federal ministers agreed that EC funding should be discontinued in Gippsland from 30 September this year. It was a mistake, and I am pleased to say that it has been addressed.

The original decision was made after a desktop analysis by NRAC. There was no visit to Gippsland, no attempt to assess the circumstances on the ground and no effort to listen to the concerns of locals. It took considerable time and effort—and that is time away from the farming enterprise—and it caused a great deal of stress for our farming families to get NRAC to actually visit Gippsland and recognise the need for an extension to the EC funding, which has since been implemented by the minister. I thank him for that. There needs to be a long-term commitment for EC declared areas to support communities like Gippsland as they recover from this drought. Perhaps just as importantly, NRAC representatives must visit or receive an on-the-ground assessment of conditions before any decision is made to remove any EC funding from a region based on lines on a map.

As we all know, when it does eventually rain it will not be raining money, and there will be a lag time in this recovery process. I urge the federal government to continue working in partnership with state and local government to support communities throughout Australia as they emerge from the drought. There is a direct correlation between the number of years in a drought and the community’s capacity to recover by itself. We have seen in the past that during a drought period regional areas lose skilled workers and many young people move on, literally seeking greener pastures. Governments must invest in the capacity of these regions to help them get back on their feet when the rains do come.

The Victorian state government, for its part, has been dragging its heels on this issue, but today, thankfully, a support package in the order of $115 million, I understand, has been announced. It stops short of the $20,000 cash grants which the Victorian state government has provided in the past, but I understand that the package does include a municipal rates subsidy, which has been strongly supported by the Liberals and Nationals in Victoria. I believe the states must continue to do their part in addition to the federal government’s EC assistance packages because it helps to send a message to the farming families that we certainly value their contribution, and they are important contributors to the future of our rural and regional communities.

Money is going to be needed for basic survival, let alone on-farm works such as fencing and maintenance work along with productivity related things such as improving pastures. All of these things fall behind when conditions are tough and money is tight. I believe our challenge with EC funding is to support these farming families to basically get them over the hump, knowing full well that they will prosper again on the other side when the rains come. This is not welfare or charity; it is an investment in the future of our nation’s productive farming enterprises. On that point, I strongly urge our farming families in EC affected areas to seek information on whether they are entitled to any assistance. Do not do the self-assessment and do not take the view that this is some form of welfare if you access the income support or the interest rate subsidies which are available through exceptional circumstances funding. After meeting with several groups of farmers in my electorate, I fear that many of them are too proud to put their hands up and ask for assistance which is available to them. It disappoints me that the state and federal governments on both sides of politics in the past have spent a small fortune on advertising and propaganda but have failed to inform enough of our farming families about the benefits which they may be able to access. In closing, I commend the member for Riverina for moving this motion and urge all members to recognise the seriousness of the drought situation across rural Australia. (Time expired)

Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

Firstly, I associate myself with the comments that were made earlier by the member for Flynn—in particular, his comments about the capacities of the current Minister for Agriculture, Fisheries and Forestry, Mr Burke. It is widely acknowledged that this current drought is significantly worse than when exceptional circumstances, or EC, assistance was originally conceived and initiated during the Hawke-Keating Labor government years as a means of providing federal government assistance to rural or primary producers. With respect to the mover and the seconder of this motion, it is impossible not to recognise the seriousness of the drought situation across rural Australia. This drought is different. It is more protracted and severe than previous droughts. Most farms are now affected in some way, and many are severely affected. The impacts on farm families and communities of such an unprecedented drought are profound and lasting. Drought and climate change are now the greatest challenges facing rural Australia. Chillingly, a commentator recently indicated that he believed that this was not a drought but our new weather. If that is the case, it is a very sobering thought indeed for all of us in this country.

When this government was elected in 2007 the Prime Minister, Kevin Rudd, made it clear that we will not be walking away from our farmers in their time of need. The Rudd Labor government has publicly committed to maintaining the existing rules and guidelines for EC for those farm families and small businesses currently in receipt of assistance. The Rudd government will continue to support those farmers and businesses in need in current EC declared areas. As the member for Flynn indicated, 33 areas whose EC status was due to expire on 30 September recently had it extended. That brings to 69 the number of areas across Australia that remain EC declared, and that is about 48 per cent of Australia’s agricultural land.

This government has not been sitting on its hands in giving assistance to rural producers. The first Swan budget set aside $760.9 million for the provision of EC income support, interest rate subsidies and interim income support for the 2008-09 financial year. The $750,000 off-farm assets cap has been extended by this government until 30 June 2009. That commitment will continue to assist more eligible farmers and small businesses to access EC assistance under these programs as they adjust to a changing climate. Beginning on 16 June this year, a transitional income support program will help producers who are no longer in an EC declared area but continue to experience severe financial difficulties. The transitional income support program is available to all farmers who are still finding it difficult to put food on the table, not just those coming out of EC declarations. $2.8 billion has been expended on EC programs since July 2001, and 21,300 farming families have been assisted. $71½ million of support has been extended to small businesses in EC declared areas, 1,100 operators have accessed income support and 1,800 interest rate subsidies have been approved. The government has stated publicly that while farmers and small businesses are in an EC declared area and meet the criteria for EC assistance they will be able to access that vital support. This will not be affected by the outcome of the comprehensive review of drought policy currently underway and mentioned earlier by my colleague the member for Flynn.

As my colleague said, some areas of Queensland have been EC declared for eight years and half of New South Wales has been EC declared for over five. This kind of makes a mockery of the urgency of this motion here before us tonight. The situation in rural Australia has been getting worse not since 24 November 2007 but over a number of years. I agree, as does the government, that there need to be some changes to policy, and we have been doing that. We have setting that up since April, as the member said.

Debate interrupted.