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Wednesday, 26 June 2013
Page: 7096


Dr STONE (Murray) (11:23): I too wish to speak on the Primary Industries (Customs) Charges Amendment Bill 2013, the Primary Industries (Excise) Levies Amendment Bill 2013 and the Rural Research and Development Legislation Amendment Bill 2013, which are being considered here. Obviously, these bills are of critical importance to my part of the world, where our economy is underpinned by agricultural production. That production, in turn, depends on innovation, well-funded research and industry development. We have gone through a very bad period when our different state and federal governments have pulled back from what were sometimes 80- or 90-year-old research stations. We have seen a lot of the CSIRO effort in rural and regional research no longer funded.

I am concerned, too, about things like plant breeding, which may take literally 20 or 30 years to undertake if, for example, you are looking for a new wheat variety that is particularly suited to our climatic conditions—perhaps in Western Australia. The seed-breeding program that used to be in place in Western Australia brought forward for Australia a whole new focus on quality and higher yields. For example, the noodle wheats in Western Australia, wheats like Eromanga, were evolved as a consequence of the state-supported seed-breeding program. Much of that is now lost and the business of breeding new varieties is too often in the hands of research organisations commercial and not based in Australia, and so they have other conditions attached to the buying of those varieties. It is no longer always the case that farmers can use their own seed for replanting, for example. Too often there are highly restricted conditions around the seeds—patenting or licensing. This business of research and development—including the levies raised, matched by government funding in this case—is a most important matter for the future sustainability, evolution and additional productivity in Australia's agriculture.

What do these bills do? They allow statutory RDCs to undertake marketing at the request of the industry in addition to their more traditional activities. I have a little issue with this. When an RDC does something like promote the eating of fresh fruit or a dairy product, or maybe Australian meats, this tends to increase the shopper uptake of that product. The shopper goes home perhaps with more cans in their trolley or more fruit in their diet. This is a good thing but, of course, imports also benefit from that marketing effort. If the general response to that food category is stimulated by marketing dollars, I have a view that the importing country should also contribute to that marketing effort, particularly in the case of New Zealand, where we have a great deal of two-way flow in food. We have, as we know, under the CER, or Closer Economic Relations, a longstanding arrangement whereby there are no barriers or inhibitions between the two countries in terms of tariffs, duties or quotas. Only phytosanitary considerations are in place. Yet, if RDCs are to raise levies for marketing within Australia to promote, for example, the eating of apples, I think the New Zealand Apple and Pear Marketing Board, the equivalent body, should make a contribution.

The bill will also make sure that the government's matching funding extends to voluntary contributions made by the industry. This change is intended to encourage voluntary private sector investment, and we need to see that across Australia. The bill also removes product specific maximum levy and charge rates to reduce the cost and delay associated with primary industries electing to increase investment in R&D and-or marketing. The minister will be prevented from setting the levy or charge rate above that recommended by industry, and that is a good thing, but all of this is about reducing red tape and putting more control back in the hands of the industry itself. These are important developments, I believe.

The board selection processes are to be altered and, hopefully, improved. There is also going to be a reserve list created for suitable candidates. A selection committee will create this reserve list. It will cut the size of selection committees, reduce expense and delay in filling board vacancies but, importantly, also look at the diversity and gender balance of various boards. It is too often the case that all we see on these RDCs are men and yet, in agriculture in particular—take dairying—you see men and women participating equally in the business of running their farms or, indeed, participating at a high level in industry policy development.

Funding agreements between statutory RDCs and the government will be required from July 2014. These will provide a more flexible mechanism for agreeing governance and performance issues. This will allow timely modification of these arrangements when needed without having to come back for legislative change. It will improve consistency in the government's relationship with RDCs—that is the aim—a bit like local EBAs. I think it can only be good where, if the industry is in agreement and the government is in agreement, you do not have to come back and queue to see legislative change put in the pipeline.

So these measures look at cutting red tape; they allow marketing to also be an activity of the RDCs although not to have, we understand, government funds put into the marketing arena—just into the R&D activities. That is appropriate and understandable. But we are concerned about the consultation time frame. The industry has had no time to review the legislation and we, the coalition, have hardly had any time at all to look at the issues. There are a large number of stakeholders from very diverse industry sectors who really should have been consulted. There should have been extensive feedback in relation to these changes.

Perhaps we can still have some feedback. We do need more flexibility and less red tape in this area. We need to increase the funds available for R&D in Australian agribusiness in particular. We have had a real problem of productivity not growing in Australian agribusiness sectors for quite a while. Of course we have had floods, droughts and pestilence—that is for sure—but it is interesting to see the productivity advances being made by our neighbours like New Zealand, but also in Asia. Those productivity increases in the agribusiness sector have been quite astonishing, while in Australia we have been standing still.

I was particularly concerned when our crisis—our tragedy—struck in the Goulburn and Murray valleys, where virtually overnight the canning fruit industry found no market for their produce. We needed to consider quickly what alternative varieties to plant which might have greater market value, or indeed whether there were vegetables or some nut varieties to make best use of the soil types, the climate and the human capital in my part of the world. So we looked around for research and development capacity at the state level, at the federal level and in the private sector, but we found there is in Australia a real dearth of expertise and funded support for research and development in horticulture. We used to have the work of the Tatura Research Institute, which did such amazing things as developing the Tatura trellis system. This revolutionised the way fresh apples and pears were grown. It is a system that has been emulated throughout the world. But that particular place, the Tatura Research Institute, now has virtually no research scientists still employed. Unfortunately their places have been backfilled with public servants who are employed by the Goulburn-Murray Water authority and who unfortunately are highly inefficient and a burden not a help or an assistance in keeping our agribusiness in place given the unconscionable fees and charges that they are now imposing.

We do need to look very hard at research and development activity in Australia. The statutory RDCs are a critical part of that. I also hope that, if we stimulate our statutory RDCs to be more flexible and to also have a marketing focus, they will address or somehow stimulate a younger generation—the next generation of people working in primary industries. We have so much distress and concern in horticulture. Our dairy industry are hardly making any return above their costs of production. We have a serious problem in many parts of our country with the costs of doing business. Whether it is energy charges, veterinary supplies, farm chemicals of any description or fertiliser, the costs confronting our primary industry sector are making us less competitive, and that is without even starting to discuss the labour costs in Australia compared with our competitors.

So research and development is critical. We once led the world in innovation in our seed-breeding and in our livestock genetic development. We supplied the world with the most superior genetics in our wool-producing sheep varieties. We developed cattle species that are able to survive in tropical Australia and can resist ticks. These cattle have a virtually disease-free status compared with other varieties of cattle who have traditionally been bred in other parts of the tropical Southern Hemisphere. We have done an amazing job in the past but we are now slipping with our research and development effort. That is reflected in our virtual flatlining of productivity growth over the last 10 or so years. It is also reflected in the lack of decent returns for people working in primary industries. It is reflected in the fact that we have a crisis in the next generation's reluctance to take up agribusiness. We have very low levels of investment in food manufacturing or indeed even back on farm.

Perhaps the saddest reflection of all is on the state of our agribusiness or our agricultural science training in universities. Unfortunately, universities now have a funding model which depends on how many students they can seat in their hallowed halls, how many of those students are overseas full fee payers and how many refereed journal articles or pieces of research can be published. Unfortunately, the agricultural science courses do not tick any of those boxes. They are not popular with overseas full-fee-paying students. They are very expensive to run. They do not necessarily lead to additional publishing in refereed journals. These facts are reflected in the collapse in numbers in agricultural science teaching across all of our universities and the near disappearance of institutions like Dookie Agricultural College and other great Victorian institutions—agricultural colleges that, I would argue, trained some of the best agribusiness specialists in the world. Certainly they were in demand as such.

I am concerned about the rush and the lack of consultation in relation to these matters of significance to agribusiness and the future of agriculture in this country. The industry has not had sufficient time to review the legislation, nor has the coalition. However, having said that, I need to say the changes do appear to be positive and I am anxious to see that more work is done in the closing days of this parliament in relation to these issues.