Pauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

My question is to the Minister for Agriculture, Senator McKenzie. There is an immediate need to deal with the imbalance in bargaining power between dairy farmers and processors by legislating to make unfair contracts, and in particular multiyear contracts that bind farmers but not processors, unlawful, because these farmers do not have the means to pursue these unfair contracts in court. When will we see the draft mandatory dairy code of practice? And how long will the consultation period be in relation to the code of practice? And will the government introduce the mandatory dairy code of practice before the end of the year, giving farmers some hope?

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

Thank you, Senator Hanson, and thank you for your advocacy for dairy farmers. Like you, the National Party and the Liberal Party are strong supporters of the dairy industry and the 5,699 dairy farmers that are right around our country. Ninety-eight per cent of our dairy farms are family owned and operated, and making sure they're sustainable going forward, making a profit at the farm gate, is exactly what we're focused on doing. That is why we committed to introduce a dairy code of conduct. That is why that code has gone out for consultation twice already. That is why I am right now getting the exposure draft completed: so it can go out for its third and final consultation prior to the end of the year, we can get it instilled in regulation and give our dairy farmers the security they need when negotiating contracts with processors.

As I've travelled round the country, one thing about the dairy industry is that it is very different in different states. In WA, for instance, I, with Nola Marino, met with dairy farmers last week. They are hurting because they don't have the competition in processors to actually get a decent price for their milk. But, Senator Hanson, we also need to make sure that profitability is through the system, so we're getting the dairy code of conduct up and running. We've got other measures to help them. We standardised contracts to actually give them financial and legal advice through Dairy Australia and be able to get a level of expertise so that, when they are negotiating a contract with a processor, they've got the support that they need. They're very good at producing milk and sometimes they need those additional skills to get the right price. We're also, though, addressing energy and fodder and water costs because those are also the input costs that are affecting the ongoing profitability of the dairy sector. But what the dairy farmers need is competition for their product.

Scott Ryan (President) Share this | Link to this | Hansard source

Senator Hanson, a supplementary question?

Pauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

Milk processors are the beneficiaries of the government's delay in introducing a mandatory dairy code of practice. Will the government make sure there is a retrospective provision in the code to allow farmers to renegotiate contracts in accordance with the code once it is introduced?

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

As I was saying, Senator Hanson, giving our farmers choice where they can sell their product is absolutely paramount for them to get a decent price, and they don't just have to go to the one or two processors in their region; they can actually sell their product to more places. Opening up new markets for our dairy industry across the globe will also help them be more competitive and get a better farm gate price. That's why we are unashamedly negotiating free trade agreements. Even with the Indonesia free trade agreement, an Australian dairy farmer has said that those tariff reductions with, hopefully, the Indonesian—

Scott Ryan (President) Share this | Link to this | Hansard source

Order! Senator Hanson on a point of order?

Pauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

My point of order is on direct relevance. The question was: is there a retrospective provision in the code to allow farmers to renegotiate contracts?

Scott Ryan (President) Share this | Link to this | Hansard source

You've reminded the minister of the nature of your questions. She has 22 seconds remaining to answer.

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

Thank you. The Australian dairy farmers saw that getting the Indonesian economic partnership agreement up and going would actually be worth $6½ million per annum to the Australian dairy industry. That is another way we are assisting our farmers. In terms of the content of the code, it is actually based on the two consultations that we did prior to the election— (Time expired)

Scott Ryan (President) Share this | Link to this | Hansard source

Senator Hanson, a final supplementary question?

Pauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

That wasn't really an answer to renegotiating contracts in accordance with the code. The dairy market was deregulated in 2000 but has since been reregulated by a small number of milk processors and the two big supermarkets. Why has the government waited until there has been a mass exodus of dairy farmers before realising a code of practice is required?

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

Senator Hanson, that's actually not true. Our government has been taking steps to stand by our dairy farmers and the industry more broadly over many, many years. It was the competition review that we did under Professor Harper that went to exactly the heart of this point: to actually make sure they've got market power. Getting the code in place is an important commitment we made and we're going through getting that done. There is no hold-up whatsoever on our side to get this in place and give farmers the security they need.

We also need to recognise that getting their electricity prices down is important. The Labor Party, when they were bringing in their carbon tax, forgot to model the impact on our dairy farmers. It was going to cost 15 grand per annum to keep a perishable product cold and make sure it was transported and able to be sold. We are taking action on energy prices. We're trying to assist farmers. We have a specific package for our dairy farmers around energy costs. We'll implement the code as soon as possible. (Time expired)