Glenn Sterle (WA, Australian Labor Party, Shadow Assistant Minister for Road Safety) Share this | Hansard source

It is a sad indictment of the Morrison government that this bill needs to be debated in the Senate today. It's an admission that the Liberal-National government has failed Australia's dairy industry miserably. Today government senators will stand up in the Senate to, essentially, pat themselves on the back. They will show no contrition or regret that, as a third-term government, they have been slow to act and have hidden behind reviews and inquiries as an excuse for not acting. The real test today is for the Nationals senators—those once proud Country Party representatives, who are far from that now—particularly Senator McDonald, Senator Davey and Senator McMahon. Will you stand with dairy farmers and vote for this bill? I think you've made it pretty clear that you won't. Unfortunately, you're going to roll over like doormats, once again, and follow the Liberals blindly.

The fact is that the dairy crisis occurred not just last week, last month or even last year. It is important to put the critical facts on the table about the current state of the dairy industry. There is a significantly smaller national herd, reduced farmer confidence and ongoing price pressures. Dairy Australia's initial forecast for 2019-20 anticipates a further drop of milk supply, between three and five per cent, to about 8.1 to 8.3 billion litres. It is important that the Senate understand just how tough circumstances have been for our dairy farmers for some time now. For too long our dairy farmers have been caught in a cost-price squeeze, and their plight has now been compounded by the shocking drought.

The coalition government turned its back on our dairy farmers when Murray Goulburn, back in April 2016, cut farmgate milk prices and backdated the clawback of the price to July 2015. A week later—and remember this was 2016, when Mr Barnaby Joyce, the member for New England, was agriculture minister—Fonterra did the same thing. It was estimated that the clawbacks created average debts of about $120,000 for each dairy farmer.

On 24 May 2016 the shadow minister for agriculture, the member for Hunter, wrote to the then minister asking him to join him in a bipartisan manner to put pressure on Murray Goulburn to deviate from its profit-sharing mechanisms. The member for New England ignored that request and essentially ignored the plight of our dairy farmers.

The reckless actions and failed capital raising structure by Murray Goulburn fell disproportionately upon dairy farming families and it was not fair. Murray Goulburn could have suspended the direct link between milk prices and money it pays to investors. They could have directed funds back to higher milk prices for farmers to provide a significant cashflow boost to farmers. But there was no pressure from the then agriculture minister for Murray Goulburn to do the right thing. This is the same man who stands up grandstanding for his own self-interest. He wants the top job back and all of you over there know that. We over here know that.

Liberal and National senators will say that in response to the Murray Goulburn debacle, dairy farmers were given access to farm household allowance and concessional loans, but they are missing the point. It should never have come to that. Dairy farmers need a fair farmgate price, transparent contracting and effective dispute resolution mechanisms. All senators in this place already know that there have been a number of inquiries supporting the fact that the dairy industry is facing a number of challenges and a crisis situation.

The Senate also noted back in 2016 that the Australian dairy industry is facing an unprecedented crisis with the retail cost of bottled milk per litre often less than the retail cost of bottled water. Australian milk production since deregulation over 15 years has decreased from approximately 11 billion litres per year to nine billion litres per year—that's a 20 per cent decrease—while New Zealand milk production has almost doubled.

In 2011 a report to the Senate Economics References Committee recommended that:

… producers' contracts with farmers should offer a clear, consistent formula for milk pricing with unambiguous conditions.

Five years later the livelihoods of up to 40 per cent of Australian dairy farmers are under threat because of imposed retrospective debt helped by unclear, inconsistent milk pricing contracts with ambiguous conditions. The committee also noted that:

Despite being Australia's third largest agricultural industry, the dairy industry faces a number of significant challenges which, if left unaddressed, have the potential to threaten the long term viability of dairy production. The industry is not homogenous and varies with distinct challenges across different geographical regions. Challenges also arise due to the inherent and interconnected relationships between farmers and end consumers. For many farmers, the challenges they were already facing were exacerbated by the retrospective price step-downs of May 2016.

Sadly, the issues facing the dairy industry have been left unaddressed and it's most likely why government members, during the previous sittings and on 17 October of this year, voted against another inquiry into the dairy industry by the Senate. Fortunately, the motion was successful even without government senators.

Senator Duniam was given the job of trying to explain why the government would not even support a Senate inquiry into the dairy industry, claiming that, 'The government does not support re-regulation via an ACCC investigation as regulation is not supported by the industry. As recommended by the ACCC we're implementing a mandatory code of conduct to increase fairness and transparency between dairy farmers and processors.' This is the government, not me, 'The code has been developed in consultation with industry and will help to address the imbalance in bargaining power between farmers and processors.' They also went on to say, 'Progress has been made to expedite the code and an exposure draft will be released shortly for industry feedback and is expected to be in place by 1 January next year. The government is also reviewing the rural research and development corporation system, with consultation currently open until 4 November 2019.' The rhetoric just doesn't stack up. A Senate inquiry does not have the power to re-regulate the dairy industry and the code of conduct can only do so much, if it ever gets implemented. Essentially, Senator Duniam was being loose with the truth, but most likely he was given that statement by none other than the agriculture minister, Senator McKenzie.

The Senate committee inquiry is seeking to ask and answer questions this government is just too scared to do. The inquiry motion begins:

That the following matter be referred to the Rural and Regional Affairs and Transport References Committee for inquiry and report by the third sitting day in March 2020 …

I won't go into the terms of reference, because time is limited, but I will say that we need to do this inquiry. Therefore, the question has to be asked: what are the government members and senators scared of? We know the Prime Minister is too scared to talk to dairy farmers. This was exposed when Shoalhaven dairy farmer Mr Robert Miller blocked the Prime Minister's car during the election campaign, telling him, 'Mr Prime Minister, it's cheaper to wash your car with milk than it is with water.' Sadly, Mr Miller was ushered away from the car, and the Prime Minister disappeared into the ether. What happened on that day in Nowra is another indictment of the Morrison government. Dairy farmers shouldn't be ignored, and the Prime Minister should have taken the time to talk to the farmers. Instead he was only there to open Warren Mundine's campaign office.

We know via media reports:

Furious Nationals MPs have lashed out at Mathias Cormann's "too cosy" relationship with Pauline Hanson, arguing behind closed doors his Senate deals with One Nation were undermining the party.

That's the Nats. They can't help themselves. They go straight to the papers to tell the world. Keep telling us. It was an extraordinary story by Rob Harris that ran on 24 October 2019 in The Sydney Morning Herald. It totally exposed Nationals MPs as being more concerned about their own self-interest than the interests of dairy farmers. It reports:

Two former Cabinet ministers—Darren Chester and Barnaby Joyce—were among a handful of MPs to voice their concerns over the Finance Minister's deals … claiming he had shown "a lack of respect" to the junior Coalition partner.

This is of real concern. We don't know who the other Nationals MPs or senators were, but I'm sure the member for New England is working on those numbers. Senator McKenzie and Mr McCormack are watching their backs. So far, we know that the list of disgruntled members includes Mr Joyce, Mr Chester, Mr Gillespie, Mr Pitt and Mr Hogan. Whilst Mr Gillespie has again voiced his concerns recently, the Senate should note that the member for Lyne has been frustrated with the Morrison-McCormack leadership team for quite some time. In the House of Representatives on 20 February 2019 the member for Lyne stated:

I've spoken before in this House about the crisis facing Australian dairy farmers. I met with representatives from Farmer Power, a dairy producers group from Victoria; and the South Australian farmer who recently exited the industry, Casey Treloar. My predictions are coming true.

Unfortunately, Mr Acting Deputy President Bernardi, time does not permit me to keep going, but I think you get it pretty clearly. We will see that, on that side over there, the once-mighty Country Party has disintegrated back to being doormats. I'm terribly sad that this is how you treat Australia's dairy farmers. We in Labor will be supporting you, Senator Hanson.