Mr O'CONNOR (11:20 AM) —I appreciate the indulgence of the committee as it is very difficult to be in two places at once. I am scheduled to speak on the floor of the House, as I speak here now, on the ANZFA bill. I do appreciate the indulgence that has been given to me by the committee, by members of the government and by the minister who has carriage of the Agricultural and Veterinary Chemicals Legislation Amendment Bill 2001. This bill addresses the system of evaluation, regulation and control of agricultural and veterinary chemicals. In the last 10 years in this area we have seen the consolidation of disparate Commonwealth, state and territory regimes into a single national system. This has happened in three main stages: committing the Commonwealth's role in this particular area to legislation, establishing a national body to administer this particular system and synchronising regulation across the country by creating uniform national legislation through cooperative legislation schemes. It is the last area that is the focus of the bill that we are debating today.

It is instructive at this point to reflect on the history of this issue and the body that is strategically involved in this area, the National Registration Authority. It was set up under a previous Labor administration, and we are quite proud of that. The fact that Australian agriculture now has an image which is, to use the popular phraseology, clean and green, is due in no small part to the administrative and institutional frameworks that were set up by previous Labor ministers in this portfolio in government. Going back a little bit on the history, in 1988 the system was put on a statutory footing and the Commonwealth assumed the responsibility for determining policy on the clearance and registration of agricultural and veterinary chemicals. At that time a new national body, the Australian Agricultural and Veterinary Chemicals Council, was set up. In 1992 we saw a further development with the creation of a new body, the National Registration Authority for Agricultural and Veterinary Chemicals, which was set up to replace the previous council. It was in 1994 that the parliament passed a package of legislation laying down the base to administer a uniform national system for the evaluation, registration and control of agricultural and veterinary chemicals. This has come to be known as the Agvet scheme.

Recently we have seen two High Court decisions in the area of Corporations Law which have called into question the constitutional validity of national cooperative schemes such as Agvet, to which I have just referred. In the Wakim judgment in 1999, some aspects of the scheme of conferral and consent by state and Commonwealth laws which permit a federal body to exercise functions in both federal and state matters were found to be constitutionally invalid. In the recent decision, Hughes—as I understand it; I am not a lawyer, a bit like the minister opposite me, although he may well be a lawyer—

Mr Tuckey —No.

Mr O'CONNOR —We are bush lawyers. As I understand it Hughes took the same line as Wakim. In that case the attention was focused on the administrative bodies and not on the courts.

This particular case law has led to the introduction of this particular bill to the House, basically to strengthen the application of that agvet scheme. If we go back historically and look at Australian farming practices, we have not been astute, as a farming community, in the use of chemicals. I think back to my early days, of being raised in the Western District on a dairy farm where we also grew onions and potatoes. The introduction of chemicals in the sixties was a new way of coming to grips with pests and diseases and improving the productivity of the farm. My father was an onion grower, and the primary source of weed control when I was growing up was to get on your hands and knees with a little hand hoe and go up and down the rows to cut the weeds out. Of course, those farmers who were a little better off turned to chemicals, and some were rather dubious in their application.

One of the sad features of the introduction of chemicals to Australian agriculture in a mass use sense was the fact that farmers themselves had virtually no idea of the correct way to apply them. In my community there were many farmers who died early as a result of the impact of chemicals on their bodies. They were not aware of those adverse impacts. Medical science will probably record that those farmers died of certain diseases but will not record the causes of those diseases. That issue of occupational health and safety on farms was not an issue back in the late 1950s and 1960s, when I grew up.

With the amalgamation of farms and the structural adjustment that occurred, the farming community contracted. We saw less of a reliance on farm labour to do some tasks and an increasing reliance on chemicals. Those chemicals, in many instances, were very efficient in areas of weed and pest control, but the occupational health and safety ramifications of their use was not something that farmers at the time understood.

One of our great advantages today in Australian agriculture is the image that overseas consumers in particular have of Australian agriculture being clean and green. We are recognised as a supplier of quality assured food produced in a clean environment—one which is sustainable—and we are recognised as a country that now adopts a minimalist approach to chemical use. That was not always the case on Australian farms.

We have seen in Australian agriculture not only this emphasis on a minimalist approach to chemical use, but also a development of the organics industry, where there is no use of chemicals at all. This has a fairly strong pulling power to consumers who have become more environmentally conscious and want to be assured that what they consume is produced in a production system which is aware of their needs as consumers for food that they regard as clean.

One of the interesting developments, as I look at the area that I grew up in, is the rise of small organic enterprises. One enterprise in particular that I can relate to is a small manufacturer of organic ice-cream located in Irrewarra, just outside of Colac, the home town area where I was born and raised. I have to say—and this might be a free advertisement for the ice-cream that is produced there—that it is a blessing and a curse for those who were raised on dairy farms. It is probably the most exquisite ice-cream that you could ever taste, but too much of it could land one in a very serious state over time, as far as one's heart condition is concerned. But the Hitchins, the family that produce the ice-cream, have an almost unlimited demand for it. They go around the local shows and the local marketplaces and they have a small value adding enterprise on farm, but the demand for what consumers perceive to be a good quality product that is clean and free from chemicals is very strong indeed.

I think Australian agriculture has made giant strides in reducing the reliance of Australian agriculture on chemicals—and the institutional framework that was set up under previous Labor governments was part of those giant strides. There are some in the community who would have Australian agriculture not use any chemicals at all. We have to be very cognisant of the fact that one of the responsibilities of the sector is to produce clean safe food, but there is another responsibility of the sector and that is to produce cheap food. I do not mean rock-bottom priced food, but quality value food for Australian consumers, especially low income families. Farmers are happy to do that as long as they get a fair share of the retail dollar. What we have seen in recent times—and the minister comes from a farming area so he would know this as well as anybody—is that, in the carve-up of the final retail price of many foods, a disproportionate amount of the price goes to others in the food chain and not to farmers.

Farmers are finding themselves increasingly squeezed at the production end. I have travelled throughout Australia in this portfolio talking to farmers, and there are a couple of issues that come up perennially in the food production and retailing debate. The first of those issues is that prices farmers receive are being squeezed at the farm gate, yet the retail margins are expanding. We can see that in the milk, citrus, apple and pear industries and a lot of other industries as well. We know that, under Australian law, farmers are not able to bargain collectively, in many instances, with processors for a better deal from the marketplace. We have an issue in Victoria at the moment with chicken growers. We have problems in other areas of agriculture, where farmers are being squeezed at the farm gate in the prices that they get for what they produce, yet the retailing margins seem to be very large indeed.

Accompanying that is the issue of supermarket power. The supermarkets are demanding of farmers an increasing quality in the produce that they supply. Because of the pressure that is coming onto the farm sector from supermarkets, farmers have to turn to measures and to areas where they are able to secure a quality output for sale to those retailing chains. In this situation, the judicious use of chemicals to prepare the field and to prepare the product for the marketplace is very important indeed.

Chemicals are used at various stages in the production chain, not only on farm to control pests and disease—which influence the productivity of the farm—and in the preparation of the produce on farm for the marketplace, but when we get into value-adding processes we can acknowledge the role that they do play in agricultural production without necessarily endorsing their use. We need to ensure we have the administrative frameworks and institutional structures in place to effectively monitor their use and ensure not only that farmers are aware of the chemicals they are using but that they have skill in applying those chemicals in the production process.

It is a heavy responsibility that falls not only on government to successfully monitor chemicals in food, but also on the companies that produce these products for use in Australian agriculture. They too have a responsibility to educate and ensure the products of their research are judiciously used so consumers can have confidence that the food they are consuming has a minimal input of chemicals in the production process.

There are two main agencies involved, the National Residue Survey, the NRS, and the National Registration Authority. The National Residue Survey was established in the early 1960s in response to concerns in major export markets about pesticide residues in meat. It has, 40 years later, expanded the range of commodities it covers to meet the growing industry demands on its personnel and services. Operationally, in the last financial year, the Residue Survey was divided into the following programs: animal products, grains and horticultural products, and fisheries and aquaculture products. Surveillance, compliance and prevention programs are an integral part of the operations of that particular body.

It is also involved in laboratory procurement and performance evaluations. The primary purposes of that survey are to meet the needs of participating industries in maintaining access to key markets, maintaining consumer confidence in Australia's food industry and food production, establishing a bank of objective and scientifically valid data, using that data to underpin quality assurance programs and assisting in resolving what you would call residue related trade incidents. These residue monitoring programs are fully cost recovered. That particular body is accountable to the parliament—and so it should be. Some of the most important programs and areas of its activity are the surveillance, compliance and residue prevention programs that have been developed in key rural industries, including the cattle industry and the sheep meats, pig, honey, apple and pear industries.

In agriculture we have had some real conflicts between primary producers and the use of chemicals in a quite different production process. The endosulfan residue in beef is an example that comes to mind. Endosulfan is an organochloride insecticide that is widely used on cotton and other field crops, and in orchards. However, it has the potential to contaminate cattle when they graze on contaminated pasture or crops.

The history of this is interesting. In 1999-2000, cattle originating from the cotton growing areas of New South Wales and Queensland were tested under a program conducted under the auspices of Safemeat. The extent of the survey needs to be appreciated. Between October 1999 and March 2000, 14,200 samples from 4,430 properties were tested for endosulfan residue. This program was very important to assure our major trading partners that this chemical residue was under control. We are dealing with the meat industry, one of Australia's major exporters, and the consumers of our products are becoming increasingly concerned about chemical residues in the products that they import. They are putting strict environmental strictures on production processes and on issues such as chemical residues.

The National Registration Authority of Agricultural and Veterinary Chemicals operates the Agvet scheme. The review of registered chemicals that takes place under that program is announced in the Agvet chemicals gazette. Each year, importers, manufacturers and exporters must provide the NRA with a record of quantities of chemicals transacted as a component of any formulated product. Any person wishing to supply agricultural or veterinary chemicals or chemical products must apply to that particular body for licences, and NRA registration is required for products other than for human use to kill pests and control diseases. It is a very important body and, I am proud to say, it was originally set up under the previous Labor administration.

This is a very important issue to Australian agriculture. The Agricultural and Veterinary Chemicals Legislation Amendment Bill 2001 is necessary to tidy up the impacts of case law outside the operating system. The opposition support the measures that the government has outlined in this bill. We are committed, as an opposition, to the minimal use of chemicals in Australian agriculture, to the production of clean, green produce that consumers can have confidence in, and we are committed to strong regulatory frameworks and institutional structures that give effect to that objective.