Mark Coulton (Parkes, National Party) Share this | Link to this | Hansard source

Picking up from where I left off before question time on the drought support package, I would like to now talk about the additional funding for water related infrastructure in New South Wales and Queensland. As you would know, Mr Deputy Speaker Scott, from your seat of Maranoa, reliable water is vital and, indeed, the farmers that are on the capped and piped bore schemes are the ones that are managing this drought now better than most. A lot of the surface water has dried up, so having that reliable water is important.

What has shown up in this drought is the environmental damage that can be done by having concentrated water points. So the idea of this additional funding is for farmers to be able to expand the network of their water infrastructure across their properties to enable the livestock to be spread out, to give them access to clean, fresh water and also to have access to all sections of their property. I believe that this part of the package will be roundly welcomed by the farmers. I would also like to mention at this point that we need to continue on with the GABSI, the Great Artesian Basin Sustainability Initiative, which has enabled many of these bores already to be capped and piped. In New South Wales and Queensland, there are still about 500 bores to go. The fact that the water pressure has increased in those areas, from the piping and capping, and despite what some of the green mischief makers might say about the Great Artesian Basin, shows that this has been a great initiative. Indeed, many bores are now flowing that were not before because of the piping and capping under GABSI. There is also social support assistance that will help communities, mental health workers and service providers in drought affected areas. That is also very important—that those people have the support on the ground.

Finally, there is also the issue of pest management. As much as we admire our coat of arms, at the moment the emus and kangaroos are in plague proportions. They are actually dying from starvation in many areas. There needs to be a program in place to control not only those but also wild dogs and wild pigs that are impacting on those areas and making it difficult to support and feed those livestock. Having spoken to a farmer in my electorate who is trying to feed his sheep where the emus are chasing the sheep away from the feed, I can tell you it has been a very, very frustrating exercise. I might note that the green groups that protest about animal rights, PETA and groups such as that, have been remarkably absent in this drought. I have not seen any of those green activists offering to help a farmer support and feed their livestock.

In closing, I would like to say that the farmers that need this assistance need this assistance because there has been no rain. Don't anyone in this place and outside think that the farmers are in financial difficulty because of management decisions or lack of expertise. The farmers in the Parkes electorate and the farmers in these drought affected areas in the northern and western part of the Parkes electorate are some of the most efficient in the world. It should be known that they are producing more kilograms of grain, fibre and meat per millimetre of rain and litre of diesel than anywhere else in the world. Indeed, if they were using the farming methods that their fathers and grandfathers used, they would have been out of business some years ago. The problem is that it has not rained for approximately two years in some places. Many of these farmers have stored fodder, they have put away what cash reserves they have and they have done an absolute sterling job in keeping their properties running for the last 18 months to two years without any rainfall. But what we are looking at now is going into the next winter, which means the next 12 months without sufficient income, and quite frankly I do not believe there is any enterprise that can be prepared to carry itself through that level of drought and disadvantage.

As a nation and as a government we have a responsibility to keep those people on those farms in a position where, when it does rain, they can get back into production. When it does rain, these areas are immensely productive. We should understand that our farmers are the most efficient anywhere in the world but they are in drought. This is not a handout for inefficient farmers; this is a hand up for farmers who are dealing with a climatic condition that is disastrous for them.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak on the Farm Household Support Bill 2014 and the Farm Household Support (Consequential and Transitional Provisions) Bill 2014. Obviously, as an inner-city MP I do not have the direct constituents who will be asking for this support, but I come from St George in rural Queensland and know well that 80 per cent of the Queensland landmass is in drought. That is about 1.5 million square kilometres, a bigger area than the Northern Territory and about the same area as Mongolia, for the sake of reference in terms we have been discussing today.

I commend the previous speaker, the member for Parkes, for his insightful words. As a Labor member of parliament I do all that I can, and I was grateful to hear his comments about how efficient our farmers are. I was also reminded, when he talked about the emus, that after World War I, when there were emu plagues in Western Australia, they apparently sent in a former machine-gun corps to clean up some of the emus. I am not advocating that, but I do understand how, when the drought is on, animals will do anything for grain or green pick.

These bills will provide financial assistance to farmers and to their partners who contribute significant labour and capital to a farm enterprise that has significant commercial purpose or character. Both sides of this chamber are in support of any extra assistance that we can provide our famers, although I am a bit disappointed to see that the coalition government failed to follow through on the significant drought policy developed by the former Labor government. I do believe that, as climate change rolls out more and more, there will be more and more challenges like this that we face. That will be the reality. The member for Parkes spoke about the practices of our grandparents on the land; the reality is that, with climate change, we will have to rethink. It is not just going to be a market distortion to support those who are least prepared with the consequences that come. I know there are significant suicide issues in rural areas as we experience this drought.

I know of my home town in your seat of Maranoa, Deputy Speaker Scott. Almost the last time I was there it was with Prime Minister Gillard looking at the results of the flood flowing over the top of the bridge at St George. Now they are crying out for rain. I am hopeful that there are some clouds on the horizon this week. I believe there is some better weather heading Queensland's way. But I fear the income support packages mentioned in this legislation have been rushed and the scheme will only provide marginal assistance for drought affected producers.

Obviously, Australia is that unique continent and country with a variable and mostly arid climate and settled by people who brought European animals used to grazing on crops and grasslands where water comes regularly. Our cattle and sheep have that tendency, but obviously our grasslands are different. They are used to being completely dry, almost going into hibernation and then blooming when the rain comes. Historically, the observed trends every scientist can tell you about towards increased warming come with increased rainfall in many tropical areas and decreased rainfall in many temperate areas. Everyone understands that these will continue. For South Australians out there it will be like redrawing Goyder's Line annually. That is the reality of the globe that we are left with. That is why we need to act on climate change wherever we can. Government assistance for Australian farmers will only increase, and a plan needs to be established that addresses drought affected areas and goes beyond a wage to help farmers in the short term, although obviously we do support this bit of the legislation.

I am also standing here as the member for Moreton, because the Brisbane Markets are in my electorate. Unfortunately, they were flooded a few years back as well. Seventy-seven hectares of land at Rocklea, a business that turns over $1 billion a year, 54 primary wholesalers and 90 additional support businesses are all located in this Rocklea business. It employs up to 4,000 people on a daily basis. There are 7,000 growers putting produce through the Brisbane Markets, so the produce from a lot of those drought affected areas will end up in my electorate of Moreton.

I went to their prize-giving event there last week, and again they raised with me the issue of the horticulture code of conduct, something that was introduced by the then agriculture minister, Minister McGauran, back in the 41st parliament, as I understand it. This is an issue for the way the industry is broken up. The horticulture code of conduct does not apply to the retail chains like Coles and Woolies. Because Coles and Woolies get their produce direct from the growers, they arrive at a price. I will introduce two bananas here—B1 and B2—to make a comparison. If B1 came from Woolies, the price would be agreed by Woolies. If B2 here came from North Queensland—I will put the props away now—supposedly the price would be agreed to before the banana was put in the case and shipped from the tablelands, Babinda or wherever, all the way down to the Brisbane Markets. Theoretically, the stakeholders at Rocklea would have to agree on the price and know the quality of the banana. That is not how it really works. Rocklea works based on trust between the grower and the people at Rocklea who actually retail it. Sixty to 65 per cent of the total product produced by fruit and vegetable growers is outside the scope of this mandatory horticulture code. Coles and Woolies have a voluntary code, but the independent retailers have this extra regulatory burden where they need to understand the fruit they are about to sell. Deputy Speaker, as you would know—because you eat so much fresh fruit—the quality of the tomato or the banana or whatever you are going to buy can vary significantly.

Much of the Rocklea market is based on trust. Now we are talking about third generations who are providing fresh fruit and vegetables to Rocklea that are then sold on to the greengrocers and the restaurants. Many restaurants go direct to the markets and get their product from the market wholesalers. Because these market wholesalers have been going for generations and dealing with the same farmer or the farmer's son or daughter or grandchildren, they know that they can rely on each other. If the farmer said, 'These bananas are top quality,' and they turned up and they were not, then that trust would break down immediately.

It is impossible under the Horticulture Code of Conduct to actually agree on a price, because the bananas will vary slightly. So despite the millions of transactions that take place around Australia—because the Brisbane market is just one of 430 market-wholesaling businesses throughout Australia that turnover in excess of $7 billion—these market wholesalers and the Horticulture Code of Conduct are competitors with Coles and Woolies. The retail chain has a voluntary code of conduct but the market wholesalers have this mandatory Horticulture Code of Conduct that is effectively just red tape. And I call on the Minister for Small Business, Minister Billson, to look at the businesses that are affected. They are mainly small- to medium-size businesses—not Coles and Woolies, but the small- to medium-size businesses—that have to put up with this red tape.

The horticulture code prescribes methods of operations which are completely inconsistent with the way the growers and wholesalers do business. Can you imagine a wholesaler getting on the phone to the farmer down in the Lockyer Valley at the time the truck is packed, and agreeing on a price at 2 o'clock in the morning? Do you think that the farmers down in Gatton, or wherever they are, want to be phoned at 2 o'clock in the morning when the truck is being packed to agree on a price? That is not how it works; that is not the reality.

There are millions of transactions going on every year. But I am happy to say that despite those millions of transactions, in the last three financial years the horticulture mediation advisory reports indicate that there have been only 28 inquiries about infringements and only six formal requests for mediation under the code. In fact, in the last financial year there were no mediations. So, we have all of this red tape—or we can call it green tape because it is around fruit and veggies! It affects small businesses, the farmers and the retailers—it does not affect Coles and Woolies—the people who are trying to have a go under this code, and the reality is that no-one has anything to complain about.

It is an impost that I would ask Minister Joyce to reconsider. It is something that I will take up on behalf of the Brisbane markets, because they are in my electorate, to see if we can get rid of this red tape. I notice there is going to be an attempt to get rid of some unnecessary regulations tomorrow, and this is a classic example. A code that does nothing except put a tax on everyone's banana—every banana that is bought outside of Coles and Woolies. It is a red tape that adds to the price of every potato bought at a small retailer or any fruit market.

The growers and wholesalers do business in a trusted way. They have been doing that for years. Anyone who goes to the Rocklea markets would know that people have these long, continuing relationships where they know how to trust each other. It is grandchildren dealing with the grandchildren of farmers, growers and producers. The ACCC report indicates that in the last three years they have only taken action against two businesses for breaches of the code—and I know one of them. One was a business that was a grower acting as a wholesaler.

This was put in place by Minister McGauran to protect—misguidedly, I think—some people who thought there was an issue. The reality is, there is unnecessary red tape and unnecessary cost. All households are paying for this red tape in the fruit and veggie area. Anyone who understands the sale of fruit and veggies knows that the code is basically irrelevant. They just ignore it, because the relationship is based on trust. There is a cost to taxpayers, because they are administering the code. I would like the government to take that up and get rid of it.

When we are talking about the Farm Household Support Bill 2014 it does come back to that underlying concern that every sensible science-believing person understands, and that is that we need to act on climate change. It is not enough to stand up every question time and say, 'The carbon tax, the carbon tax, the carbon tax.' The reality is that we believe in using a market mechanism to achieve the best possible outcome for a horrible set of circumstances. That is, if we do not act to combat human-induced climate change our grandchildren and our great-grandchildren will not have a planet—will not have a planet where they are able to have a decent lifestyle. There is that other fact, of course, which is that it will cost more to act later. We almost have to be able to look our children in the eye and say, 'That's your problem, not ours.' I am not prepared to do that. The Labor Party has always been a party devoted to doing the best thing by the collective—the best thing by the nation. It is not just a group—

Mr Brough interjecting—

I can hear comments coming from the arc of mediocrity!

Rob Mitchell (McEwen, Australian Labor Party) Share this | Link to this | Hansard source

The member for Fisher will have a chance to talk later.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

There is a disembodied voice coming through. The reality is there is a market mechanism and putting a price on carbon is the best way to achieve the lowest possible—

Mal Brough (Fisher, Liberal Party) Share this | Link to this | Hansard source

Mr Deputy Speaker, I invite the member to take a question.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

Mr Deputy Speaker, I am on the home straight now.

Mal Brough (Fisher, Liberal Party) Share this | Link to this | Hansard source

Quit while you're ahead.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

I am happy to quit while I am ahead. The reality is that the Liberal Party used to believe in markets. The carbon price we introduced was all about achieving a market mechanism. That is what we need to do. We need to make sure we change behaviours. The best possible way to do that is by putting a price on the businesses that emit the most. Having bureaucrats in Canberra pick the best possible mechanism is a very risky game. Putting all your faith in that magic dirt that scientists have said will not produce the offsets that we need is a very risky game. I ask those opposite to understand our principal position in terms of pricing carbon.

Dan Tehan (Wannon, Liberal Party) Share this | Link to this | Hansard source

I would like to return to the Farm Household Support Bill 2014 and the Farm Household Support (Consequential and Transitional Provisions) Bill 2014. We have just had I think 12 minutes on every other subject but the bills. These are important bills and I think we should be addressing them here in the House at this time and leaving other issues to better forums.

These bills are about addressing drought. The people currently experiencing drought are going through what can only be described as a natural disaster. As the Prime Minister has said, the determination of the Abbott government is to stand by Australians in good times and in bad times. We cannot work miracles and there are no magic wands, but we will do what we can to help in difficult times, and, plainly, for quite a large number of farmers now these are difficult times.

I remember growing up on a farm as a boy and experiencing the 1982-83 drought and the difficulties faced then on our farm and across the nation as it was hit by one of the worst droughts that we had seen. The situation in many parts of Queensland and New South Wales is worse than that drought. My empathy and sympathy go to those farmers who are currently battling drought. To see the impact that drought has on your livelihood, on the animals and crops you are relying on for your annual income, can be absolutely destroying. The farmers and their families have to deal with this. They have to deal with both the physical and mental strains of this.

It was very pleasing to see the Prime Minister understand this and in a very considered manner deal with it. I say that because there has been talk from the other side that this policy was rushed. It was nothing of the sort. The Prime Minister consulted. He consulted with relevant MPs from regional and rural Australia in the Liberal and National parties who have a real understanding of the impact of drought on the ground. He then visited key electorates suffering from drought. With the Minister for Agriculture and other relevant MPs he brought together a package to deal with the current circumstances.

It is worth mentioning that we were left in this situation because the previous government had singularly failed to put forward a long-term drought policy for this nation. They had abolished the previous approach but had done nothing to put in place a policy we could use in these circumstances. So this government was beholden once again to clean up the previous government's mess. That is what we have done. We have done that through this program.

In the first instance we have done it through the Interim Farm Household Allowance package, which came into effect on 3 March, so we can give immediate help and immediate support to those farmers who are being impacted by drought. Come 1 July the interim package will no longer exist and the package we see here today will come into effect. It means farmers will be able to access the farm household assistance package as they need to. They will be able to access it not only in New South Wales and Queensland but also in other areas if they, unfortunately, are also impacted by drought. This will provide immediate assistance for them.

The farm household allowances are not the only part of the package that the government has put together. There are also the drought concessional loans. We are providing $280 million for concessional loans to assist drought affected farm businesses recover from drought and return to profitability. A key aspect of the concessional loans is helping farmers return to profitability. If you cannot make a profit then it is very hard for you to continue to run a business, or in this instance a farm.

There are two key components in what we have put together. In the first instance there is immediate support for those farming households and in the second instance there are concessional loans to help them return to profitability. Farmers will potentially be able to change the way their overdraft facilities are working and be able to go to their bank and say: 'I have the ability to access these concessional loans. What can you do for me?'

The drought concessional loans of up to $1 million or up to 50 per cent of eligible debt, whichever is lower, will be provided to eligible farm businesses at an initial rate of four per cent for a five year period. This will enable those farmers to be able to make sure that they can restructure their businesses after the impact of this drought. It will ensure that they can continue to trade and continue to run the business and turn it into a profitable business once again. We need to do that because the farm sector is a sector which will, in a large part, ensure that our economy continues to grow into the future. We have all seen the surveys, the studies and the reports which have been done. These reports say how important our agriculture sector is going to be to the future economic success of this nation. What we as a government have to do, is to make sure that we are there to support our farmers when the difficulties of natural disaster hit. This is what our government is doing.

As part of the package, we are providing $10 million to help on the social side. One of the sad things about drought is that it has a real impact on the social side of farming families. It can put pressure on the farm, the farmer, the spouse and the children. The impact can be incredibly detrimental. Many farming operations take place in a very isolated environment. In times of hardship, there is a need for people to get the advice and the assistance that they need to make sure that they can deal with the real stresses of dealing with financial pressures and what they are seeing happen to their livelihood. This can have a real impact on farm family life. The government understands that. That is why a key component has been to provide $10 million to assist in this vital area. These are vital services. They are services which are provided to many people in communities across the nation. Because of their isolation, these services are not readily available to those people who are on farms out in regional and rural parts of Australia. This $10 million will ensure that in times of real need these people can get the assistance that they need. This is an important part of this package. Vitally, it also shows that the government has listened. It is all very well addressing short-term and then long-term financial need, but you also have to have an understanding of the real social impact that drought can have. The package has recognised that. It is a comprehensive package in that regard.

Once again, I would like to make mention of the roles the Prime Minister and the agriculture minister have played in pulling this together. It has been done with proper consultation. It has been done with thought. It has been done in a considered way. It is not one of these packages which has been put together over the weekend to try to get the headline to try to deal with the issue in a way which will deal with the 24-hour news cycle. This is a package which was put together through proper consultation, through proper consideration and through having a real understanding of the needs of those people out on those communities. At the same time it has been done understanding that sadly, given the reckless spending which has occurred in the last six years, whatever we do in the current circumstances we have to understand that our children and their children cannot be left with an increasing financial burden. We have to lead the way in showing that this generation can live within its means. So we have had to balance that with making sure that we have done what needed to be done for these people who are suffering drought.

In summing up on this piece of legislation, what we have is three key components to this drought package. We have the first part of it, which is the farm household allowance. We have the interim farm household allowance, which came in on 3 March, which will be replaced on 1 July. In this instance, it will help farmers immediately. There are also the drought concessional loans. These are there to help with the profitability of farmers, to enable them to restructure out of drought. Hopefully, very soon we will get the much-needed rain. Then they can turn their attention to, 'Okay, how can I restructure my finances, get some concessional loans at four per cent and ensure that I can return profitability back to my business?' Then there is also the social support assistance, that $10 million which will enable much-needed assistance and help to go into those households who are facing the real stress, both financially and emotionally, that drought can put on farming families. The future of farming in this nation is a bright one.

I have absolute confidence in the future of Australian agriculture and Australian farming. All we have to do is to make sure that, when natural disasters hit the sector, the government is there to help farmers and that we have policies in place to ensure that the sector is profitable, so that this fantastic sector can go on feeding this nation and the world. We should not listen to the pessimists in this regard. We should listen to those who have confidence in this sector, who know that it is a provider of export income to this nation, who are out there working hard and efficiently to ensure they follow world's best practice. This nation should be very proud of our farmers, who continue to provide an income for this nation, to feed it and to feed the world.

Debate interrupted.