Cathy McGowan (Indi, Independent) Share this | Link to this | Hansard source

In continuing my speech there are just two more points I would like to make before I finish up. They are the importance of coordinating cross-sector research and the impact that this legislation will have on the ability of RDCs to work together.

It seems to be a minor point, but it is one that has really come up through the agricultural competitiveness green paper. That is that the community, and particularly the agricultural industry sector, is very keen that there be more cooperation between the RDCs. At page 91, there is the call for establishing a new body, or particularly tasking existing research bodies to coordinate cross-sector research. They talk of a new or existing body that could be tasked with promoting agricultural research; ensuring research was focused on RD&E priorities; encouraging R&D activities across disciplines; and identifying the next big potential transformational research areas to encourage investment, collaboration and uptake. I note that in the legislation mechanisms to bring people together are being done away with. I think this is such a pity because it is a time when we actually need to come together more often and share the intellectual capital we have if we are actually going to make the transformations we need in agriculture.

A few years ago I was on a committee tasked with establishing a national strategic investment plan for rural research and development in Australia. One of the really important things that came out of that national rural investment plan was the need for high-level collaborative brains coming together to look at how we could actually bring our scarce resources and deliver for the country on what we knew needed to be done. I have to say that there was one important part of the election campaign—the allocation of $100 million to agricultural research and development—that did bring the RDCs together, but a whole lot more needs to be done. It is such an opportunity where we can bring people together.

If I could just give you one example of how it happens in a very practical way. As you might know, I am a farmer and I grow sheep. In my learning days, I benefited from the ability of Australian Wool Innovation and MLA—Meat & Livestock Australia—to come together. On the ground they had community based learning activities, otherwise known as extension, for farmers to learn how to work together. In my community that particular program was called BESTWOOL/BESTLAMB and it brought sheep producers, pasture growers and meat producers together. We were able to actively collaborate in our communities about the best way of taking research, implementing it on our farms and then producing the result, which was much higher returns on our investment. This came about because Meat & Livestock Australia and Australian Wool Innovation worked together. Previous to that, they worked with the other very important research group called Land and Water Australia that brought everybody together.

What I am saying in terms of this legislation is that there is an opportunity in the years ahead of us, particularly if we can pick up the recommendations in this report, to bring the RDCs together and to actually look for efficiencies where our research, our development and our extension can deliver much better results for farmers. Because the reality is most of us farmers actually work at that cooperative level. I think the legislation is taking us away from that opportunity to work together.

If I could just bring my comments to a close, what I would like to do in summarising is say that it is great that we have ways and we have people working on how we can save money; $7 million is $7 million, and it is really important to save $7 million when we can see it. But not at the cost of losing the trust of the industry; not at the cost of losing the trust of the National Farmers' Federation. How often is it that the NFF comes into this House and says to my colleagues opposite, 'This is not good legislation; this needs changes'?

So I am really happy to be able to stand in this parliament as a friend of the NFF and speak on their behalf and encourage them to work with my colleagues in the Senate to get the amendments that we need to make this ability to collaborate stronger, to make the ability for us to work internationally stronger, but most importantly to not put things in concrete forever—to put a sunset clause into this legislation so after five years, when, hopefully, the economy is a much better position, we can revert to how things used to be.

Eric Hutchinson (Lyons, Liberal Party) Share this | Link to this | Hansard source

It is a real pleasure to speak on the Rural Research and Development Legislation Amendment Bill 2014. I note the member for Indi's comments, but in working towards my contribution today I spoke to Australian Wool Innovation. They are over the moon about the $100 million—$100 million that needs to be used collaboratively. They welcome the fact that there is money on the table there that the federal government has invested in research and development that will need to be leveraged with the private sector and industry and that will need to be leveraged also with the universities and higher education institutions. The essence of this bill is the provision of an extra $100 million over four years to the rural and research development corporations with the clear intention to boost agricultural productivity growth—indeed, in collaboration that will benefit most of all those people at the farm gate.

The bill implements a 2014 budget commitment by this government to change the way that government pays for its membership to international commodity organisations and the regional fisheries management organisations. We understand that that is a fact of life, when we have inherited a budget mess like we have. It also reduces the red tape burden currently imposed on some of the rural research and development corporations. These organisations in turn improve the trading environment for agricultural products by funding activities of benefit to our rural industries and the community in general, including research and development on issues of global significance, not least food security.

Most importantly, this bill paves the way for $100 million in additional funding over the next four years for Australia's rural research and development corporations that will be leveraged with universities and the private sector. Investment in rural research and development is an important part of the Australian government's policy for a competitive agricultural sector. There is a strong link between research and development and agricultural productivity growth, with the research and development investment delivering productivity returns that far exceed indeed the cost of that investment.

However, in recent years the productivity growth of Australian agriculture has slowed somewhat. This additional funding will deliver practical research to help farmers to be more productive and ultimately more profitable. This is funding for on-the-ground research and cutting-edge technologies that support our agriculture, fisheries and forestry industries. It is vital that our Australian farmers and producers remain competitive in international markets where two-thirds of their product goes. We should never forget that, that we are an exporting nation and that two-thirds of the food and fibre, and more so in the case of fibre, ends up overseas.

We expect research and development corporations to form alliances with institutions like the University of Tasmania, to develop exciting projects to keep our farmers and rural producers at the forefront of agricultural research. That leads me to what I want to focus on today—that is, the National Irrigation RD&E Program for Tasmania. Investment in this space is critical for productivity growth. The Tasmanian Institute of Agriculture, TIA, is a collaboration, owned jointly and managed jointly by the University of Tasmania and the Tasmanian state government.

The governance of the irrigation and extension work within TIA is done by an outstanding group of industry representatives, including Marcus McShane from the Tasmanian Farmers and Graziers Association; Allan Barr from the third largest agribusiness in Australia, Roberts Ruralco, and my former boss; Scott Schilg from NRM North, a bike-riding colleague; Richard Gardner, one of my oldest friends who represents the Midlands Water Group; Chris Thompson from Macquarie Franklin who has a wealth of knowledge in regard to the design and implementation of the irrigation schemes that we are already seeing around Tasmania; David Kay from Rabobank, who brings a commercial focus to the governance arrangement; and Caroline Brown from DPIPWE. It is a most formidable and competent governance organisation to support the work of TIA. TIA's director Holger Meinke and Associate Professor Rohan Nelson are responsible for the National Irrigation RD&E Program for Tasmania.

In trying to summarise exactly what maximising productivity out of irrigation investment in Tasmania really means, it is maximising productivity using the least amount of water and the least amount of energy. Essentially, that is what R&D in irrigation is all about. We know that this has a national significance and indeed an international significance, because by 2050 we will have a population of nine million. We have to feed and clothe those people, and that is indeed a challenge. That challenge is not going to be wholly the responsibility of Australia and it is certainly not going to be the responsibility of Tasmania—it simply does not have the capacity.

Already, we have seen in my state $310 million invested by the federal government, the Tasmanian government and private investors in irrigation infrastructure. In addition to that, another $265 million has been made in investments on farm, be that through dams or piping or water application systems—pivot irrigation or, in the case of more intensive horticulture, drip irrigation systems. One hundred and fifty gigalitres of additional irrigation water will be available for irrigators when all the planned schemes are brought into operation. To put that in context, the irrigation capacity within my home state of Tasmania and the irrigable land is comparable to the Ord River and the Gilbert and Flinders schemes, and one of the most significant investments that this nation has seen in irrigation infrastructure since the mighty Murray-Darling rivers development.

The critical difference is that Tasmania's expansion of irrigation builds on existing high-value, temperate agriculture, which is close to the population centres in my state and close to a ready workforce. Multiple small catchments are managed individually to make sure that they are sustainably governed and managed appropriately on an economic basis but also a sustainable and environmental basis. There will be over $500 million invested in agriculture irrigation schemes within my home state once the tranche 2 irrigation schemes are delivered which includes the southern highlands scheme in my electorate, the Scottsdale scheme in the electorate of Bass, the Circular Head scheme in the electorate of Braddon, the Swan Valley scheme and the north Esk scheme also in the electorate of Lyons.

The contribution of R&D is significant. I note the Tasmanian government's ambitious target to increase the value of the output of agriculture at the farm gate in my state between now and 2050 from about $1.2 billion currently annually to more than $10 billion. It is a very ambitious target. But as the West report in 2009 suggested, increases of this magnitude were indeed technically feasible, if we focus on the things where Tasmania particularly has a competitive advantage. That is around high-value horticulture; dairy, where we have a natural competitive advantage in terms of the cost of production, being able to produce milk with less grain than is normally required; viticulture; and intensive livestock operations. If 80 per cent of the $10 billion target is to be achieved by irrigated agriculture, the value generated from irrigation water needs to be increased from $3½ thousand per megalitre to nearly $16,000 per megalitre. They are enormous challenges; therefore, every bit of R&D is required to make sure that we can deliver on that potential and that opportunity.

The basis for some of the projects that we will see and the way we will achieve that significant increase in the value of the agriculture and horticulture sectors at the farm gate involve a few major projects: soils and drainage; agronomy and the different varieties appropriate for my state—grains and the different horticultural crops; precision agriculture, which will be increasingly important; whole-farm system modelling; value chains and food processing; and extension and education.

Probably no better example of the importance of education is my own experience and the work that I did before I came to this place, particularly around price risk management and encouraging the use of forward selling, encouraging the use of futures—contracts for wool growers to control one of the variables that they have within their businesses. They cannot often, as you would well understand, Deputy Speaker, control whether it rains or it does not rain. One of the ways they can have an impact—it is a bit like fixing a fence with a set of wire strainers; there are certain jobs you can do with certain tools—is understanding what is a good price, an average price or a poor price helps farmers make better decisions, and that comes with education. So there are many opportunities and the benefits will be enormous and wide ranging.

Indeed, the dairy industry will expand to meet growing world demand, through increased pasture production and better utilisation of feed grain, particularly around the expansion of the grains industry. A very large proportion of the grain use within the dairy sector is imported into our state and we are looking at ways of using irrigated grain crops to take some of those yields from about four tonnes a hectare, which traditionally is the case in non-irrigated grain varieties, to up to 12 tonnes per hectare, which is a significant increase. That is what we need. The benefits that will flow to the dairy industry as a result of being able to grow more grain in Tasmania will be significant.

Expansion of intensive horticulture and viticulture, cool climate fruits, vegetables and wine and the government's investment in infrastructure—such as $38 million to extend the Hobart airport—will give increase our exports of horticultural products into parts of Asia which at the moment are difficult to access. Tasmania has always had a reputation and a capacity to produce and be involved in very high-value specialist plant crops like, for example, opium poppies, a very important industry in my state where real knowledge has been built up by producers and processors alike. Then there are pyrethrum, essential oils, specialty grains and the production of pasture and vegetable seeds as well.

It is an enormous task. I look forward to seeing the application which no doubt the university and TIA will make through a collaborative approach to, I suspect, the Grains Research and Development Corporation and some of the other and research development bodies. As I said before, R&D, when it comes to irrigation, essentially means maximising our productivity, using the least amount of water, being smart and efficient with it, and using the least amount of energy. This is indeed what irrigation R&D is all about.

It would be remiss of me in the small time I have left not to mention the industry of which I was apart from nearly 25 years—that is, the wool industry. There are some great examples where there has been collaborative investment through AWI. As the member for Indi said, there are some excellent examples. In the case of Tasmania, it used to be the eight by five program. It is now Sheep Connect Tasmania, the leading sheep program, which works with both MLA and also Australian Wool Innovation to do some really great work. Indeed, with some of the projects we are seeing at the moment in Tasmania on the extension network, a staggering 97 per cent of farmers said they would make changes to their business and that these changes would result in more than $5,000 worth of benefits directly to their business. There is indeed value in collaboration. I cannot speak highly enough about what has been invested by the Minister for Agriculture and the federal government through this $100 million. It will be used smartly.

We must make the most of our scarce resources. There is no more important issue than productivity and research and development if Australia is going to be competitive in future in a space where we have always been very strong, but we cannot rest on our laurels. Thank you for the opportunity.

Justine Elliot (Richmond, Australian Labor Party) Share this | Link to this | Hansard source

Today I rise to speak on the Rural Research and Development Legislation Amendment Bill 2014. It is rather timely, given the very remarkable behaviour of the Minister for Agriculture in question time today. It certainly reflects on his lack of commitment and skill when it comes to making sure that we are providing good policies and plans for those in regional and rural Australia. I think they would have concerns about the lack of ability of the relevant minister.

This bill makes amendments to the rural research and development legislation and gives effect to yet another unfair budget measure. What we see is a very definite pattern with this government of broken promises and unfair budget measures. In regional areas like mine, locals know that when it comes to unfair budget measures and broken promises it is the National Party who are to blame and they are very vocal in their criticisms. We can add this bill to the long list of promises broken by the National Party which includes the doctor tax, the petrol tax, cuts to education and cuts to the pensions.

The bill is designed to allow the government to recover the cost of membership fees to international commodity organisations and regional fisheries management organisations from the matching amounts paid to rural research and development corporations. Other measures included in the bill will remove the requirement for the minister to organise an annual coordination meeting for the chairs of the statutory RDCs and removes some parliamentary tabling requirements. As I have said, this is another unfair budget measure which will impact greatly on the research and development work undertaken by the rural research and development corporations.

The government's proposed changes to the current RDC matching funding model are fundamentally changing the focus of the RDC system. The fact is the RDCs should not have to pay the membership fees for the Australian government, which is the reality. If the government believes that there is value for it to be a member of these international organisations then it should pay the membership fees. Matching funding by the government to the RDCs is an investment in the future of our agriculture, fisheries and forestry. It is generally estimated that for each genuine R&D dollar there is a $10 return and our RDCs should be allowed to invest in projects that will benefit their industry and not bear the brunt of the government's lack of strategic planning for our RDCs. As it states of the Department of Agriculture website:

The RDCs invest in R&D and innovation to improve the productivity and delivery of high quality products in order to underpin the competitiveness and profitability of Australia's agricultural, fish and forestry industries. RDC R&D and innovation also supports the sustainability of primary production and the natural resource base.

That is what the website says, and that is what the government should be properly investing in, it is what they should be properly focusing on, but of course that is not the case.

Also, we do hear the government talking about agriculture being one of the five pillars of the economy, yet its actions are completely opposed to that. By cutting funding to research and development, that is what we see. That is what we see from this Minister for Agriculture, who I see is now back in the chamber; that is indeed what he has been responsible for. Look at some of those cuts: an $80 million reduction in cooperative research centre programs; more than $100 million in funding cuts to the CSIRO, which will cost around 500 jobs. What a major impact that will be with around 500 jobs going. As we have said, we on this side of the House oppose this bill and its unfair measures.

As we know, there are up to 15 rural research and development corporations covering our agricultural industries. These 15 research and development corporations are made up of nine industry-owned companies that provide R&D services and marketing for the benefit of their industries, and six research and development corporations that provide leadership and investment. Those industry owned companies are—I will run through that list; it is important to have that list on the record—the Australian Egg Corporation Ltd, Australian Livestock Export Corporation Ltd, Australian Meat Processor Corporation Ltd, Australian Pork Ltd, Australian Wool Innovation Ltd, Dairy Australia Ltd, Forest and Wood Products Australia Ltd, Horticulture Australia Ltd, Meat and Livestock Australia Ltd.

The research and development corporations are: Cotton Research and Development Corporation, Fisheries Research and Development Corporation, Grains Research and Development Corporation, Grape and Wine Research and Development Corporation, Rural Industries Research and Development Corporation and Sugar Research and Development Corporation. The RDCs bring together industry and researchers to investigate and implement strategic directions and to fund projects that provide industry with the innovation and productivity tools to compete in those very, very important global markets. And it is the demand of these global markets that is really effectively driving our agricultural industries and the government should be supporting that, not undermining it.

The RDC model of joint industry and government funding has been absolutely vital in the success of Australia's R&D effort, having helped Australian agriculture double its productivity over the past 25 years—what a great achievement. In fact, this co-funding model is the envy of the world, and that is why we in Labor are here fighting to protect that. We know how good it is. Labor's R&D model is what working with industry is all about: not telling industry what to do, but facilitating and helping it; to be in partnership with industry. That is what is important.

The government-industry partnership model works well. It has successfully functioned for more than 20 years, which is absolutely fantastic. It is about government matching industry contributions; that is the key. But this bill, like so much else this Liberal-National government has introduced into the House since 2013, really has been an unfair attack on those ordinary, hardworking regional and rural Australians who have really been severely impacted by many of the plans of this government. And this bill is just another example of its dismantling of the matching contributions component of this particular scheme.

The fact is Labor understand how important research and development corporations are. We created them in 1989, so we understand how important they are. We established them for the purpose of undertaking scientific research for the benefit of Australian rural industries and with benefits then flowing onto the community. As we have said: the government would put in half the amount—match dollar for dollar—into R&D if industry was prepared to levy itself and make its own contributions to improve the innovation within particular sectors. These industry specific plans for R&D have transformed agriculture in this country. As I have said, we have seen that increase in productivity.

The government is now seeking to achieve a $7 million saving over four years, but this will be at the expense of tens of thousands of genuine R&D investment dollars. Essentially the government is seeking to achieve this saving over that time by changing arrangements for the payments of membership to international commodity organisations. From 2014-15 membership fees for four international commodity organisations—relating specifically to the cotton, wine, sugar and grain industries—and six international fisheries organisations will be made from the government's funding envelope for its matching contributions to the relevant RDCs instead of direct appropriation funding and, in so doing, will reduce actual R&D funding. This means that the government will make payments to the international commodity bodies from the same pool of money it says is for matching industry contributions. This is just not logical and it is certainly not an appropriate way to be looking at funding these very important matters. Much like the other policies of this government, this bill actually constitutes a cut in funding in real terms.

Worse still, this government did not even give the Australian people prior warning about any of these cuts. And we have seen that across so many other measures in so many other areas, whether it is health or education or pensions. They did not tell anyone in regional or rural Australia they intended this to be their plan. In fact, they have been telling untruths by not telling people about their plans—a real deception by omission—which a lot of people are now aware of and are pretty angry about as well. In fact, prior to the last election the then opposition made no reference to any of these particular cuts. What I think is even more insulting is the government, and many of its members, have actually acknowledged that research and development investment returns far outweigh the costs. They are aware of the reality of it, but are still allowing this to occur. With these changes, RDCs have not even been given the option to withdraw their membership to international commodity organisations.

This bill will really be quite devastating for farmers in rural and regional Australia. In abandoning matching funding for regional development and innovation, it will make it much harder for many agricultural industries in my electorate—for example, when it comes to the sugar industry—to do their business. And I am sure, Mr Deputy Speaker Scott, you are very much aware how important the sugar cane industry is to people of the North Coast of New South Wales; I would certainly hope the member for Page, who is here in the chamber, would understand how important it is as a major employer and as a major driver of our local economy. We should be out there supporting industries like our sugar industry, not placing impediments on them instead—particularly not impediments on their future research and development.

Hidden in this legislation is the repeal of subsections 6 and 7 of the Sugar Research and Development Services Act 2013. This act provides for a company to receive, under a contract, Commonwealth funding for research and development for the Australian sugar industry and to be declared as the industry services body for the Australian sugar industry. The subsections allow the minister to make R&D payments, or matching payments, to the Australian sugar industry representative. These will now be repealed, and I think it is absolutely appalling that that in particular is happening.

This government's decision to essentially withdraw funding is going to create a situation where you are leaving those struggling in regional and rural areas—those farmers—to foot the additional costs. I would assume those are subsequently passed on to consumers. It also puts them at a greater disadvantage when it comes to their overseas competitiveness and competing in those global markets. I believe this bill is another example of how the National Party in particular has abandoned rural and regional Australia.

Labor, on the other hand, have a very proud record of standing up for rural and regional Australia over a very long period of time. We created the regional development fund which, of course, is now being totally changed and watered down by those opposite. That delivered so many great projects around Australia, especially in my electorate of Richmond. I will not run through all of those again, but there were millions of dollars in projects that really transformed so much of the North Coast of New South Wales. In fact, Labor in government really took the national leadership to build competitive and sustainable agriculture industries to support farming families that contribute more than 1.6 million jobs. We understand how important it is. That is why we invested so much.

We also developed Australia's first-ever National Food Plan to boost Australia's $30.5 billion food export market by 45 per cent. We had that in place and understood how important it was. We established the Office of Northern Australia to realise the north's potential. We developed real solutions to climate and market condition challenges, including the farm finance package, which provided $420 million in low-interest loans to help viable farmers ease debt pressures.

We also invested a record amount in rural R&D, providing R&D corporations with $1.4 billion in funding over the last six years, increasing from $189 million in 2008-09, to $251 million in 2013-14. We also addressed many of those skill shortages in the agricultural industries. We understood how important it was to be making sure there was adequate funding for training and addressing some of those skill shortages, particularly through many projects and trades training in schools and a whole range of different measures that we took to address those skill shortages right across the agricultural industry. Also, through Caring for our Country and continuing support for Landcare, which was, of course, a legacy of the Hawke government, we have supported farming communities to manage and protect our natural resources, protect and conserve our biodiversity and promote the adoption of sustainable farm practices.

The Labor Party has a very proud record of standing with those in regional and rural Australia across a whole range of different areas. We continue to do that today on this side of the House. We continue to condemn this government across a whole range of areas where they did not tell the Australian people the truth going into the last election whether it was in relation to health, education or now, as we are seeing clearly, with particular aspects of rural and regional Australia as well.

I started off by saying we do have a Minister for Agriculture who does not have the skills and ability to represent these people and deliver adequately for them. They do not have any faith in him, his ability or his government. The fact is he has failed those in rural and regional Australia. He has failed those people, and they are severely disappointed by that. They are hurt by the cuts this government has brought in, particularly these cuts to R&D. It is devastating. We need to be encouraging growth. We need to be investing more. We need to be providing more for those in regional and rural areas, not cutting as we are constantly seeing from this government and this minister, who is incapable of delivering for regional and rural areas. That is why we are opposed to this bill.