Barry O'Sullivan (Queensland, National Party) Share this | Hansard source

I am very happy to make a contribution to this debate on a bill that amends Primary Industries Levies and Charges Collection Act 1991. Like the previous speaker, Senator Leyonhjelm, I too was involved in one of the two inquiries into levies. I will start my contribution by talking specifically about the beef industry, given that, of the rural industries that are affected by this change, it is the area I know best. I imagine that much of what I have to say will be as applicable to other livestock research and development corporations, along with horticulture and some of the other industries in our rural sectors.

Despite some of the observations that have been made by previous speakers about more having to be done, I have taken the view that this bill is focusing directly on using technology and innovation to increase the level of communication between research and development corporations and their constituencies, for want of a better description. In the case of the cattle industry, it is true to say that there were millions of dollars, and in fact millions of transactions, that attracted a levy. Where that money was paid, agents and others in the saleyards and others had a responsibility to complete the returns. Information about the levy payer, information about the transaction itself—that is to say, what promoted the transaction in terms of the description that was involved, in this case, cattle—was of course not available in those circumstances to the meat and livestock authority. What we do know is there are between some 36,000 and 47,000 cattle producers. Hopefully, this bill and the establishment of this register—assuming that the MLA is one of the applicants, and from my discussions with them I suspect that they will be one of the first to make application for the register, as it is something that they have wanted for a long time—will allow us to more accurately determine just how many cattle producers there are, all the way down to small producers, where a small part-time operator might just be involved in 10, 20 or 30 transactions annually, right through to major corporations, including large family corporations, who of course trade in tens of thousands of head of cattle each year.

In my discussions with the Meat and Livestock Australia, one of the problems that they have had is engagement from these levy holders, or these cattle producers, in the life of the MLA. In fact, as alluded to by the previous speaker, Senator Leyonhjelm, there were issues presented that suggested that some of the system was being corrupted to a certain extent by big players who together were very organised in how they might exercise their powers, pursuant to them being a levy payer, with the elections within the Meat & Livestock Authority itself.

The Meat & Livestock Authority has been picked as an example for me because it covers a number of very significant industries in our country. The MLA, through peak industry bodies, is involved with the Cattle Council of Australia and the red meat authority. It deals with sheep, goats, feedlots and meat exporters. In fact, the peak industry bodies that are affiliated with the MLA cover just about the entire supply chain within the beef industry. This is a multi-multibillion dollar industry in this nation. The industry is currently enjoying somewhat of a price resurgence but, at the same time, we recognise that there are many thousands of families who have not yet recovered from the effects of the live cattle ban in 2011 and the terrible drought which, whilst now largely behind us, has left a legacy where there are operations that are yet to have sufficient pasture regeneration to restock their properties. Some of these producers have spent anywhere between three and five years without a productive income. In terms of recovery, these entities often rely very significantly on organisations like the MLA and the results of the research and development that is done.

The MLA have a budget of about $170 million annually, made up of levy payments from these various sectors, along of course with the matching grants provided by government—the dollar-for-dollar match on research grants. Over a number of decades now, a tremendous amount of work has been done—and continues to be done—on research and development. One of the challenges for the Meat & Livestock Authority has been how they disseminate that information back to interested parties. There are many ways to do that in a modern world, and the MLA do that as well as most and better than some.

In effect, this legislation will give them a direct link back to a levy payer. Not only will it allow them to communicate directly with the levy payers, but the information that will be lodged on the register will start to allow them to determine where the levy payer is. The beef industry is a very diverse industry. If you are growing cattle in northern Tasmania, northern Victoria, the highlands of New South Wales, the western desert country of my home state or up in the gulf, the only thing that those respective enterprises in those geographic zones may have in common will simply be that they produce cattle. There are so many other variables in terms of the markets that they are offer. Some areas specialise in the use of hormones and growth proponents with their cattle; whereas, others pursue markets, particularly the European market, where those things are banned.

This legislation will allow authorities like the Meat & Live Stock Authority to take the results of their research and development efforts and tailor them to go back to these levy payers—the people who have invested in the research and development, along with the government of the day—and provide them with feedback from the R&D that is quite specific to both the scale of their operation and the geography of where they are operating. In fact, as I understand, in this data there will be descriptions of the trade. So they will be able to indicate what markets some of these levy payers are pursuing, so that they can further refine the research and development outcomes with these producers.

My family is in cattle in a reasonably exposed way, and I know that members of my extended family have used the results of the research and development efforts of the MLA over a period of time. This research and development was to do with pasture management, genetic selection and breed plans. They received great benefit from this R&D. In one case in particular, they modernised their operations to the point where they took what was a marginal living block or family block and they turned it into quite a profitable enterprise. Most of that resulted from them having the benefit of research and development knowledge created by, in this case, the Meat & Livestock Authority.

Importantly, this legislation will now create a direct, unbroken nexus between the MLA and these levy payers. So they should receive updates of the results of this research and development work that is directly tailored to the enterprise that they are involved in. It almost defies modern techniques to think that that had not happened up to this point. This legislation is an important leap for rural industries. As we all know, information is power. If this information is collected and collated properly, I think this will provide a great lift to productivity for many of these producers and growers of grains and cereals—in horticulture in particular.

I heard my colleague speak about investment in marketing. I would have to disagree with Senator Leyonhjelm. His reference was to a couple of sectors, and I know in the case of beef that the Meat & Livestock Authority, for example, have invested tens of millions of dollars in marketing. The MLA have established offices all around the world where our major markets are, and we have seen the fruits of their labour. We have seen the fruits of labour in the lift of volumes that have gone into the markets—of course, aided by our recent free trade agreements with Korea, Japan and China. There is some exciting work going on in this field with India and now, of course, with Europe. With the Brexit affair there are markets that are going to open up in Europe that our people had not necessarily had a chance to compete in before. With this two-way structure where these Research and Development Corporations will now have firsthand knowledge of who their levy payers are and who their audience is, they will be able to work with the peak industry bodies in the respective fields to be able to communicate with these people, also, in relation to marketing issues and the dissemination of the information from the Research and Development Corporations.

I am inclined to agree with Senator Leyonhjelm. I have only heard his contribution since I came in here. He calls for these peak bodies and these RDCs to pay more attention to the issue of transparency. I do not think there would be anybody in this place—anybody in this Senate—that would argue against creating the most transparent environment one could with the performance of peak bodies and with how they spend their money. I do agree that, over a long period of time, there have been sectors which have, I think, with some right complained about how the investment of their money has occurred, the balance between research and development and marketing, and, of course, when you get down into some smaller sectors, allegations that some of the behaviour favoured some in the sector over others.

It is particularly important, at least as far as I am concerned, to ensure that we create an environment where small operations—for what I call 'small operations' we in the cattle industry call them 'living blocks'; I am sure that they have titles in horticulture and in farming, also—are able to function and flourish. Small operations, of course, do not have a personal capacity to conduct research and development on any scale. So it is very important that their peak bodies and these RDCs are, when they disseminate this information, able to tailor it, as I mentioned earlier, to the size, scope and geographic considerations of the operations of the recipients. Small operators could not, as you would appreciate, invest money in genetic research with livestock operations as one might expect would occur on the scale of the Meat & Livestock Authority. So if we do not have this two-way communication where the peak bodies and the RDCs can disseminate this information, these small operations will be at a complete disadvantage. The knock-on effect of that is: much more large-scale corporatisation in many of our rural industries. Whilst large-scale corporatisation is an important component, if we get to a point where smaller-scale, family-sized operations—extended family operations—cannot operate and compete, then the knock-on effect will be the impact it will have on so many hundreds of our small rural communities around the country.

The larger corporate operations receive equal benefit for the investment in R&D. In fact, some R&D can only be applied on scale. So you could argue that many of the large corporations get a better bang for their levy buck from research and development than the smaller-scale operators. With some R&D, as you know, the introduction of innovative technologies requires investment. So many of our small family farms and small family horticulture growers just do not have that sort of capital to invest. It is important that we pay attention to that fact and do whatever we can through our research and development investment as a government and within the industry to ensure that these smaller-scale operations can stay and compete in the industry, lest we will see, as I say, the corporatisation of the agriculture sector. Whilst that has a positive contribution on occasions, if we were to do everything on scale then so many of our small communities out west would disappear.

Many of these larger corporate operations operate very much like the resource sector—in that they fly-in fly-out with their staff. They are more inclined to buy 10 or 15 Toyotas at a time in Melbourne and import them onto Melbourne ports than they are to go into Charleville or Roma, or Cloncurry, in my state to make purchases. So it is so significantly important that, as the government, and as a nation, we continue to focus on whatever it is we can do to enhance the ability of small family operations—these family farms—to continue to prosper, to flourish and, indeed, to make it attractive enough for a generational investment from father to son, from mother to daughter, so that they can remain in rural areas and grow the economies of those small districts.

I think in the fullness of time, as we reflect upon this legislation that is before us today, we are going to see it make a significant contribution. In a modern world, communications are instantaneous. You can press a button, if you know how to—some of us who, sadly, were born in the fifties struggle a bit with which button to push, but, fortunately, we have people who can show us what to do there—and you can instantaneously pass on very large volumes of important and significant information between one and another. That is what this bill will be about. It is a two-way street. The information that these peak bodies will receive will allow them to engage with these levy payers. And I agree with Senator Leyonhjelm: it is a challenge for them now to engage with their base, with these individuals, and to put as many tests against themselves for transparency as one can. They no longer will have an excuse that they have not communicated back to the people who have invested in this research and development, and marketing. Up until now they have had a defence that they did not know, necessarily, who they were, except for their development of databases that they have done independently of this.

I think all the appropriate privacy considerations have been taken into account in this legislation. I know that the peak bodies and the RDCs whom I have had a chance to talk to since the inquiry will welcome this. There will be some, of course, who will be anxious because they know now that they may have to make sure that the investments done on behalf of their members are done in a proper, fair and equitable fashion, because they will have an obligation, in my view, to report back to them on the progress of their efforts on their behalf.

So I think this is a positive bill. I am sure it is one that is going to be supported. I cannot see any reason why it will not be supported by everybody across the chamber. For my part, I commend the bill to the Senate.