Address To The South Australian Farmers’ Federation Annual Conference Kerry O'Brien - Shadow Minister for Primary Industries

Speech

Transcript - Adelaide - 23 July 2003

INTRODUCTION

Thank you for the opportunity to open this important conference.

Since my appointment as Shadow Minister for Primary Industries in 2001 I have had the pleasure of consulting farm organisations in every state on issues large and small.

I have, of course, met with the South Australian Farmers' Federation on a number of occasions.

And I can say without equivocation that South Australian farmers are very well represented by this organisation.

On issues that matter to farmers in this state, the South Australian Farmers' Federation is a strong and forceful advocate.

Importantly, the Federation is not instinctively reactive, but is prepared to advocate for change.

Many of you will know that I did not come to my current position from a farming background.

I had been an active member on the Senate rural committee, but I did not have a background in rural industry or a history of involvement in agri-politics.

I hope that means I have had the benefit of approaching rural issues with an open mind – a preparedness to listen to a range of views and make an independent assessment unencumbered by past personal experiences.

Today I want to share some brief observations about rural industries, farmers and farming organisations.

RURAL AUSTRALIA

First, while there is no doubt about the importance of rural industries to the economic and social wellbeing of Australia, the contribution that you make is not sufficiently appreciated in the cities.

People living in Sydney hear farmers calling for help to manage drought, they hear calls for assistance with industry structuring and, in the case of the dairy and sugar industries, they pay the cost of that assistance through taxes on the consumption of milk and sugar.

But I am not sure that people living in Melbourne and Sydney, and Adelaide for the matter, appreciate the benefits they enjoy from the fruits of your labour.

They don't hear enough about the billions of dollars of export income you earn.

Many don't understand the role of primary production in sustaining rural economies and communities.

And precious few city dwellers appreciate the fact most farmers have changed their land use practices and embraced sustainable agriculture.

All of us must do more to ensure your worth is better appreciated in urban Australia.

RURAL REPRESENTATION

Secondly, I would like to make some comments about your political representation in the Federal Parliament.

The National Party of Australia and its antecedents have purported to represent the political interests of farmers in Canberra.

Of course, here in South Australia, the constituency is a little more enlightened than most other states.

When a South Australian wants a conservative voice to represent him or her in the Federal Parliament, you do the decent thing and elect a Liberal.

Other states haven't quite got the trick, and continue to return a dwindling number of Nationals to the Parliament.

Many people are surprised to learn that there are just three National Party Senators in the Australian Parliament – one from Queensland, one from New South Wales and one from Victoria.

Of course, one National Party MP is currently the acting Prime Minister, so it's not possible to dismiss the party's relevance altogether.

But even the party's most fervent supporters would not suggest that the organisation is at the zenith of its power.

The truth is quite the opposite.

Those of us who have a direct interest in rural policy spend almost all of our waking hours competing for your attention and ultimately your political support.

We work to develop policy options that we consider will best meet your needs and advance the interests of regional Australia.

I'm not arrogant or foolish enough to suggest that only members of the Labor Party are truly committed to good rural policy.

But I do contend that Labor has a deep understanding and abiding interest in rural and regional Australia, and agri-political leaders that pretend otherwise are not representing the best interests of their constituencies.

Some agri-politicians and lobbyists have elected to focus their attention on the conservative side of politics.

In contrast, others have sought to build a broader political consensus – one that reaches across the political spectrum.

As a Senator, I have had an opportunity to participate in the Senate committee system – a system that encourages, perhaps even requires, goodwill and cooperation across the political spectrum.

And I don't think there is a better example of that cooperation than the operation of the Senate Rural and Regional Affairs Legislation Committee.

This is a multi-party committee comprised of a government majority including South Australia's Senator Jeannie Ferris.

The committee has, of course, recently completed its inquiry into the government's proposed wheat export levy.

That levy has now been legislated, and I don't want to re-canvass issues that have, by now, been so comprehensively canvassed.

But I do want to discuss the inquiry in light of the proposition that I've just put to you – that effective agri-political activity involves actively engaging all sides of the Parliament: government, opposition and, in the case of the Senate, the cross-benches as well.

There has been some criticism of me and other members of the Senate inquiry for listening to parties other than the Grains Council of Australia and the AWB Group.

It has been put – none to subtlety in places – that we should have listened to the institutional arguments in the debate and told everyone else to get nicked.

Some have hankered for the ‘good old days' where these sorts of issues could be sorted out between the Grains Council, the former Australian Wheat Board and the Minister for Agriculture, preferably a member of the Country Party.

I'm afraid those days have past, and won't return.

Supporters of the single desk – and that's a number I warrant includes most grain growers and members of the Federal Parliament – can't rely on past practices to sustain current legislative arrangements.

Labor, Liberal and Democrats Senators participated in the committee inquiry and the final debate on the bill in good faith.

It was initiated by me, and conducted in an open and public forum.

Anyone could make a submission, and those submissions were made available for public scrutiny.

In my view, the process signalled that one aspect of agri-politics – the deal done on a nod and a wink behind closed doors – is dead.

I might say that if I had accepted the initial advice of some grains industry leaders and recommended to the Labor caucus that the original bill pass through the Parliament unchallenged, the faults of the Wheat Export Authority would have remained hidden in correspondence between the authority chair and the Minister.

That is, the Authority would still lack the power to demand information – any information – from AWB International.

The proposed levy would be ongoing.

The Authority would still be undertaking a closed door review of the operation of the single desk based on the information offered up by AWB International.

And growers would not be entitled to receive a copy of the review you are so generously funding, just as you are denied a copy of the comprehensive, confidential and mis-named growers' report currently received by the Minister.

I should note that a senior employee of a rural organisation connected with the debate took some pride at the outset of the inquiry in claiming the committee was no more than a "pussy cat" that could be confidently ignored.

I understand the employee – and his organisation – no longer hold that view.

They now recognise that when you are asking the Parliament to legislate on your behalf you must recognise your responsibilities to your constituency and the wider community and argue your case.

I think the inquiry outcome has signalled to farm organisations that the political process is now more demanding than ever – demanding on farm organisations, rural companies, farmers and political participants including the Minister.

RURAL ACCOUNTABILITY

The third observation I want to make concerns the relatively recent shift from statutory authorities to private companies as the preferred agency for the delivery of industry services.

This shift has been based on a desire to allow industries to have more control over their own affairs.

The Commonwealth does not own these companies, but they receive significant funding in the form of compulsory industry levies and R&D payments from consolidated revenue.

In contrast to the stringent accountability inherent in the R&D corporation model, a statutory funding agreement is the centrepiece of the accountability regime imposed on these new industry service bodies.

No one doubts the need to adequately fund appropriate rural research and development.

Nor should one fail to recognise the benefits Australia's rural R&D arrangements have delivered to our rural industries and the broader economy.

But equally, there should be no doubt that the community demands that the Federal Parliament fulfil its responsibility to ensure taxpayer funds, and the industry funds it levies, are subject to appropriate accountability.

In my view, the failure to adopt a suitably stringent accountability model for these new bodies could ultimately put at risk Australia's rural R&D research model.

If community and industry confidence in the accountability of the bodies receiving funds is not maintained, the whole arrangement is put at risk.

This is a matter for industry, certainly, but it is a matter for government as well.

The current Senate inquiry into Australian Wool Innovation was triggered by the failure of Agriculture Minister Warren Truss to investigate serious allegations about the expenditure of public and grower money by that company.

It is a failure on the part of the Minister that I don't want to see repeated.

Nor do I want to again endure the tortuous process of getting his department to explain the steps it took to ensure tens of millions of dollars of levy and tax funds were spent appropriately.

At the May Estimates hearing I asked the senior bureaucrat responsible for the funding agreement between the Commonwealth and AWI what action the department took following the resignation of a board member in mid-2002, a resignation linked to concerns about corporate governance.

He told me he couldn't remember Dr Vizard's resignation and would have to check on the detail.

That revelation followed an admission that the government did nothing to investigate public claims that the former board had entered into fifty ‘informal' contracts worth about $20 million.

This inquiry will provide the committee with an opportunity get to the bottom of some of the pretty wild claims made about AWI's expenditure of public and grower funds.

It has already heard that the Minister was asked to investigate serious allegations about corporate behaviour at AWI by Woolproducers as long ago as February 2000, but did absolutely nothing – apparently he didn't even acknowledge the letter.

The inquiry by the Senate Rural and Regional Affairs Legislation Committee will give the committee an opportunity to examine how the new model of industry service delivery is working, and perhaps make some recommendations about how the accountability regime can be strengthened and the ongoing flow of public funds for rural R&D ensured.

COOPERATIVE FEDERALISM

The fourth observation I want to make relates to the structure of government we enjoy in this country and its impact on your wellbeing.

Wherever you look in the agriculture, fisheries and forestry portfolio you find involvement by the states and the Commonwealth.

Both have an administrative interest and a financial obligation in most programs that impact on rural Australia.

In my view, a fracturing of the relationship between the states and the Commonwealth is having an adverse impact on rural program delivery.

For example, we now have hundreds of millions of dollars of funding left unspent in key programs related to sustainable land use.

Natural Heritage Trust and National Action Plan for Salinity and Water Quality spending is years behind due to protracted and fruitless arguments about the size and nature of funding from the states.

Meanwhile, small problems continue to build into very big problems.

Areas of degraded land that were recoverable a decade ago may now be lost for generations.

It is clearly in every Australian's interest that government achieve the salinity reduction and improved water quality goals of the National Action Plan.

Unfortunately, Commonwealth spending on the National Action Plan will fall more than $200 million short four years into its life.

The program is funded on a 50-50 basis, so four years into the plan, $400 million that should have been spent on environmental repair will remain in Commonwealth and states treasuries.

Farmers are frequently subject to unjustified claims about lack of concern for the environment.

As I told the recent National Farmers' Federation conference in Canberra, I can't think of a greater act of environmental vandalism than the failure to spend promised money addressing Australia's salinity crisis.

Drought reform is another policy area suffering because of deteriorating Commonwealth/state relations.

A number of sensible reforms to the National Drought Policy – signed off by the Commonwealth and all states last May – are still sitting on the shelf because the Commonwealth wants to argue about a new funding arrangement with the states.

These changes include a new co-operative assessment regime, support for communities preparing applications, the introduction of permanent buffer zones and consideration of cash grants instead of interest rate subsidies.

These reforms are sensible, desirable and affordable.

They won't solve all the problems with EC, but they will go a long way towards addressing concerns about bureaucratic delays with applications, arbitrary delineation of eligible EC areas and the debt trap that some say is encouraged by the current interest rate regime.

At the moment, farmers are denied these sensible changes and are forced to live with a raft of changes to the National Drought Policy unilaterally introduced by Mr Truss.

Beyond the introduction of prima facie assessment, these changes have been uniformly regressive.

I don't need to tell you that farmers and state governments face a complex – almost unworkable – system that discriminates against many farmers based on the nature of their business, the timing of their application, the form and quantum of state based assistance and whether the Prime Minister has been a recent visitor to their region.

It seems actual hardship falls a long way down the assessment check-list.

There's no better example of the consequences of that complexity than the recent failure of AFFA to explain to a Senate Committee how industry differentiation in the drought assessment process impacts on the rights of FMD holders in relation to early withdrawal provisions.

The department simply did not know.

It is no surprise that the NFF has called on the Commonwealth to assume full responsibility for the administration and funding of program.

For the record, I don't believe the Commonwealth should assume full responsibility for EC assistance.

I think the Commonwealth and the states ought to work together to improve the current program and deliver more effective and timely assistance.

Additionally, state departments have experience and administrative capacity necessary to the effective administration of the program.

The starting point is surely the reforms agreed at the May 2002 meeting of the Primary Industries Ministerial Council in Hobart.

Those who suggest co-operation between the Commonwealth and the states on drought policy is a pipedream don't have good memories.

The National Drought Policy announced by Primary Industries Minister Simon Crean in August 1992 was negotiated with a majority of non-Labor states.

Labor doesn't accept that the Exceptional Circumstances program can't be reformed through negotiation, and I urge you to encourage the Minister to once again turn his attention to this task.

RURAL WATER

The final observation I want to share with you is the importance of the current debate about water.

In the first interview I did after being appointed to the position of Shadow Minister for Primary Industries I was asked what was the most important issue facing rural Australia.

The answer was easy.

I said the most important issue facing rural Australia is water.

That was the view of the Council of Australian Governments in 1994 when it laid out a plan for an intergovernmental agreement to address the issue.

Now we find the Leader of the National Party announcing the Howard Government's national water initiative nearly a decade later with an inter-governmental agreement between the Commonwealth and the states as its centrepiece.

What I do know is that this, or any other water plan, will fail if negotiations with the states aren't conducted in good faith.

In the absence of genuine negotiations, water reform will fail – just like EC reform and the implementation of the National Action Plan has failed.

CONCLUSION

I believe rural Australia has a bright future.

One of the things that has struck me as I've travelled around the country talking to farmers is that we're all in this game together.

Most politicians don't work on the farm.

By the same token, most farmers don't listen to politicians.

But only by working together can we hope to achieve the outcome we all want for the rural sector – a prosperous and sustainable future.

With a bit of luck and a lot of hard work I hope to play a direct role in helping build economic prosperity and social stability across the farming community after the next election.

I particularly look forward to working with the South Australian Farmers' Federation over coming months and years.

In the more immediate future, I wish the council and members a stimulating and successful conference.

It gives me much pleasure to declare this year's conference ‘open'.