Bridget McKenzie (Victoria, National Party, Minister for Regional Services) Share this | Link to this | Hansard source

I table a revised explanatory memorandum relating to the bill and move:

That this bill be now read a second time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

FUTURE DROUGHT FUND BILL 2018 SECOND READING SPEECH

The Liberal-National Government is focused on helping farmers and communities prepare for inevitable future droughts.

The Future Drought Fund is a long-term investment to build drought resilience, including preparedness and recovery in our most drought affected communities. It will enable farmers and their communities to fulfil their potential as productive and profitable contributors to the Australian economy by improving the performance of the agriculture sector.

Healthy farming landscapes with innovative farming techniques will contribute to a drought resilient and sustainable agriculture sector. The Future Drought Fund will be available to support research, development and innovation. It will also deliver infrastructure projects, promote the adoption of technology and support improved environmental and natural resource management to encourage sustainable agricultural practices. The Future Drought Fund will provide farm and community support with the aim of bolstering drought resilience.

This Bill establishes the Future Drought Fund and provides an initial credit of $3.9 billion. The Government intends to grow the Fund until it reaches $5 billion, while at the same time drawing down $100 million per year from 1 July 2020 to invest in important drought resilience projects. The establishment of the Future Drought Fund will provide a new, secure, predictable revenue stream to build drought resilience across Australia into the future.

This funding is additional to the significant funding already available to assist farmers during an existing drought and will not replace existing funding.

The Future Drought Fund will be managed by the Future Fund Board of Guardians, which has a proven track record of managing investment portfolios on behalf of the Government and maximising returns over the long-term.

The Bill requires the Treasurer and the Minister for Finance and the Public Service to issue directions setting out the Government's expectations as to how the Fund will be managed and invested by the Board, including setting a benchmark return for earnings. In setting the benchmark rate of return, the Government will consider the objectives to grow the fund to around $5 billion and make annual payments to the Agriculture Future Drought Resilience Special Account of $100 million per year for disbursement to drought resilience projects.

The Government will develop and publish the Drought Resilience Funding Plan to ensure that a coherent and consistent approach is undertaken when considering and providing funding for drought resilience projects. The Funding Plan will be informed though public consultation and will be reviewed every four years to ensure that emerging priorities are appropriately captured in ensuring the Fund remains future-focussed. In developing the Plan, the Agriculture Minister will have regard to the Intergovernmental Agreement on National Drought Program Reform and any successive agreements, as well as any related Government drought policies and strategies.

To ensure consistency with the Drought Resilience Funding Plan, the Minister is required to seek advice from the Regional Investment Corporation Board on any grant or funding arrangement. This advice will inform how the new drought resilience funding is allocated in each budget cycle.

Drought is a constant factor in Australian agriculture and the establishment of the Future Drought Fund will provide a new, secure, predictable funding stream for drought resilience into the future to ensure the potential of this vibrant industry is realised through drought resilience planning.

The Government had intended to use the Building Australia Fund to fund the National Disability Insurance Scheme, however, as we already confirmed earlier this year, we have secured the future of the National Disability Insurance Scheme and ensured that it is fully funded through our better economic and fiscal management, which has delivered a strong and improving budget position. This means that we are able to fully fund the National Disability Insurance Scheme without persisting with the Medicare levy increase or the previous Building Australia Fund measure.

This is why we are now in a position to give our guarantee to Australians living with a disability, and their families and carers, that all planned expenditure on the National Disability Insurance Scheme will be able to be met in this year's Budget and beyond.

Helping our farming communities face the challenges of drought is a key focus of this Government and because we have fully funded the NDIS, we are in a position to now use the uncommitted funds from the Building Australia Fund to build a sustainable source of funding for drought resilience, preparedness and recovery across Australia.

Debate adjourned.