Tammy Tyrrell (Tasmania, Independent) Share this | Link to this | Hansard source

This is the perfect time to talk about the Tasmanian Freight Equalisation Scheme, because, in case you didn't know, there's an election on the way. If Labor or the Liberals want to show that they give a damn about Tasmania, it's time for them to take action. My inquiry into the TFES made one thing crystal clear: the TFES is broken. It's a clunky scheme that doesn't work.

The TFES began in 1976 to compensate Tasmanian businesses with no access to the mainland's national highway and rail networks. We have to get our produce across the ocean. That costs way more than highway freight. The scheme is supposed to make sure Tassie businesses aren't disadvantaged compared to their mainland counterparts, but for many businesses the scheme is more trouble than it's worth.

TFES is supposed to be a rebate, and that's the thing about rebates—they happen after the purchase and you get some money back after you spend it. The value of the rebate is growing but slowly—very slowly—and shipping costs are racing ahead, like they've got a rocket behind them. So, if your costs are going up twice as fast as your rebates, you're getting poorer every time. You're going backwards. The economist Saul Eslake said that he could only hope this snail's pace adjustment to the TFES rebate rate was not deliberate discrimination against Tasmania.

Fruit Growers Tasmania gave some hard numbers on it. They told us the cost of using sea freight over road travel has gone up by 2½ times in recent years, from $389 to $918, per container. Doesn't that sound like a scheme that's working! Here's the kicker. Not only are businesses getting a tinier rebate back; we're making it impossible for them to claim the rebate in the first place. People in business simply want to get stuff done. They don't have time to work with stupid levels of red tape for little or no return.

Wine Tasmania told us that 40 per cent of its members don't claim a rebate from TFES, because it's so hard to do for such a tiny rebate. A scheme that works doesn't make things so hard to navigate that you need a PhD to make heads or tails of the claims process. For big businesses, this isn't such a big problem. They have in-house accounts teams whose job it is to make sure these paperwork struggles get handled. For small players running their business from a kitchen table, between dropping the kids off and picking them from school there aren't enough hours in a day to find their way through the maze of bureaucracy being imposed on them. And, if they do, they get less now than they did two years ago. When they do make a claim, they have to wait as long as three months for the rebate to finally hit their bank account. What small business can afford to wait three months?

It's a scheme that does nothing to help small businesses or make things fairer for them, so here's what the committee recommended to fix. The first thing is to review the whole thing and how it can be made to work properly. It doesn't work as it should. We can make a flying start with this. Witnesses and stakeholders have already told us what needs to be put right and how to do it. The second is for the Tasmanian government to look at TasPorts and its part in the TFES and how it can change in the best interests of Tasmanian businesses. The future of TasPorts is already in question, so it's a perfect time to look at the needs of its stakeholders and not to its corporate dreams. The third is for the Australian Competition and Consumer Commission to review how trade works across the Bass Strait and its islands. It must look at both sea freight and airfreight routes and at commodity pricing for the fresh produce sector. There are two recommendations for Services Australia to fix the clunky and complex system for rebates. The first is to set up a helpline and resources to help claimants understand how the system can work for them and what they can claim. The second is to build an online tool for businesses to check if they can make a claim—and for how much.

We saw layers of complication emerge in what should have been a simple problem to solve. The problem is where politics and red tape collide, with people in business wanting to get on with the job they do so well. All but one of us on the committee were Tasmanian, and it was interesting to watch the eyes of my fellow committee members open up with the evidence given to us—Senator Anne Urquhart; Senator Richard Colbeck; Senator Claire Chandler; Senator Glenn Sterle, from WA; Senator Nick McKim; and me.

These recommendations are fine and will probably lead to improvements for the scheme, but, from where I sat as chair, I knew we could have done far more. The recommendations are the product of consensus from all parties. After all, major parties don't want to agree to strong reform written on paper for the world to see—they might actually be asked to implement it! I wanted us to take a giant leap for Tasmanian businesses, not small and timid steps. That's why I put forward my additional thoughts as an independent voice. Making payments to businesses must be simpler and straightforward. Every claim should be done with no delay, and systems can change to meet this need. Payments can be automated with an account system for regular shippers of regular consignments. If you added digital infrastructure that could integrate with a shipping application program interface for shipping providers, the admin burden would disappear for businesses and bureaucracy alike. We need to include airfreight in the scheme to get high-value, time-sensitive produce to its markets as quickly as possible, not stuck dockside waiting to be loaded onto a ship. Yes, it'll add additional costs, but it'll lift our export profile to more higher value products and bring better jobs and new industry to Tasmania. And it would be a game changer for Flinders Island and King Island.

I've worked on farms in all weather, and I know just how hard it is. Farmers and producers pour their heart into their work just to get smacked in the face with a bad system that costs them time and money, and that's not to mention how high freight prices mean we are spending even more money on food and essentials. We've all noticed how little we're getting in our baskets for a higher price at the check-out. Just ask the residents of King Island. They're paying $16 for two litres of milk. The supermarket owners don't have a choice. It costs that much money to get the products to the island in the first place. The same is true on the mainland too. The failure of the TFES is what makes it so costly to ship Tasmania's fresh produce to your mainland markets. It's like a cost-of-living tariff on communities who are paying to enjoy the best of Tasmania's food and drink, which, as you know, is really good. It's only fair that mainland families can enjoy it too—and at the price it should be.

We know the TFES is broken, but the question now is: will anyone step up to fix it? We need brave politicians that will step up and fully support these businesses so they can support the jobs they've made and the people they employ. If Labor gave a damn about Tasmania, they'd put the recommendations into play right now. There's no reason they can't announce it today. The TFES operates under ministerial direction. The minister could and can deliver most of the report's recommendations—and include mine as well—much faster than by going through parliament, where it can be bogged down in process and procedure. If the coalition were smart, they'd commit to the TFES recommendations before Labor does. Show Tassie businesses and producers that you are on their side, because—make no mistake—Tasmania is expecting the government to take action on this. I've put TFES on the agenda, and it's time to get it done.

The work the committee and its staff have put into the inquiry and its report is extraordinary, and I thank them for it. Chairing this inquiry, my very first, was an amazing experience. It gave me the chance to talk to Tasmanians about their businesses and how they think the TFES can be better. Between us all, we can bring lasting change to the Tasmanian Freight Equalisation Scheme, bring new jobs to Tasmania and bring more fresh produce to the rest of Australia. If we can get the Tasmanian Freight Equalisation Scheme right, it will bring better food at a better price to everyone in Australia. It might even bring Aldi to Tasmania, and that'd be a win for us all.

Senate adjourned at 20:51