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Thursday, 2 October 1997
Page: 7541


Senator SANDY MACDONALD(7.24 p.m.) —I want to speak tonight on one of the government's most significant reform packages to date, and that is `Agriculture—Advancing Australia'. This $517 million package was recently launched by the Prime Minister (Mr Howard) and my National Party colleague Mr John Anderson, the Minister for Primary Industries and Energy. It brings together the inadequate tangle of assistance which had sprung up over the years, especially under the previous government, in a mostly ad hoc fashion. We now have a proper program of support, investment and education for the nation's farming families.

John Anderson deserves congratulations for this package. To call it simply a $517 million package is only to tell half the story. The $517 million includes more than $200 million more than was allocated in the 1996-97 budget, and to have brokered this deal through cabinet is an enormous achievement. All of us in the coalition, especially those of us who have connections with regional Australia, are pleased to have delivered such a substantial package.

The AAA package, as it is called, has been very well received by farming families, rural organisations and rural commentators. Mr Ian Donges, the President of the New South Wales Farmers Federation, called it a well-balanced series of measures which will set the framework for self-reliance in Australia's rural industries. The Australian called it a step on the path to making the farm sector more efficient while extending to it the welfare benefits the rest of the community take for granted. Peter Austin, in the Land, said it was just what the rural sector needed.

The scope of the package demonstrates how serious we are about making major changes to benefit those on the land, and all the regional jobs that flow from a buoyant rural economy. The major features of the package are as follows. Firstly, the creation of the tax linked commercialised farm management deposit scheme will provide farmers with the tools they need for greater self-reliance, allowing them to invest the considerable sum of $300,000 as a buffer against lean times and drought. Interest will be paid at market rates and deposits will be fully tax deductible in the year that they are made and taxable in the year of withdrawal. Reports about the possible impact of the El Nino make this scheme particularly timely. The capacity of farm families to survive drought and economic downturn was made much more difficult in the Labor years, what with high interest rates, high inflation, the cost-price squeeze and the gutting of the original IED scheme, which had provided the capacity for prudent farmers to provide for lean times and also drought.

Secondly, there is a revamped drought relief repayment, called the exceptional circumstances relief payment, which will be available to farmers experiencing other rare and severe events, not only those in droughts. This will provide some welfare assistance to farm families—assistance that is, of course, available to all other Australians.

Thirdly, there is a $50 million farm business improvement program, which will pro vide assistance for skills development, farm business planning, farm performance, risk management, marketing and natural resource management, and things like landcare in addition to that. Education is the key to everything, as we know, and that is as true of those involved in primary industry as it is in other sectors of the community.

Fourthly, there is the introduction of the farm family restart scheme, which will deliver improved welfare to the farm sector to support them while they assess future opportunities, and to allow them to make up their own minds about their future—which is very important to people; they do not like to be pushed around on the land—and make any necessary changes that are suitable for them, including support if families choose to leave the industry and leave the land.

Fifthly, there is an improved rural communities program which will provide flexible grants to assist rural communities, offer such essential services as rural counsellors—who have been an integral part in the restructuring of the bush over the last few years and most of whom have done an absolutely splendid job in the most difficult circumstances—telecentres and, of course, credit union facilities. Referring to the successful credit care scheme, I know that Senator Payne is here tonight and I would just like to put on record the integral part that she played in that very worthwhile organisation before she came into the Senate.

And, lastly, there is the commitment to generational farm transfer. This is one of the most important parts of the package, because it provides the opportunity for farmers to retire and to gift their farms without jeopardising their access to the age pension. At the moment, farmers are ineligible to receive the pension for five years, if they give away assets in excess of $10,000 a year. This has, understandably, discouraged many from transferring ownership to the next generation—especially as a lot of farmers are very conservative in their estate planning.

Under this scheme, the government has declared a three-year moratorium on these gifting provisions so that this time older farmers who make this assets transfer will have immediate access to the age pension. The moratorium is limited to net assets of $500,000 per farm, and other conditions apply, including an income test. By acknowledging the difficulties surrounding the gifting and aggregation of farms and proposing changes, the coalition has taken on some of the biggest challenges faced by farming families—a set of serious problems ignored by the previous government. If you recall, the previous Prime Minister called himself `the farmers' friend'.

It is the coalition who has listened to farmers in dire straits, to those who have slipped through the holes marked `farming family' in our welfare safety net. It is this government which has heard the pleas of the men and women who live in regional areas and who really call for government assistance but at this time whose options have run out.

Labor had little understanding of primary industry. They floundered as drought ravished the country and as commodity prices plummeted. You may recall that then Prime Minister Keating lectured those who live in the bush by saying that drought is a natural occurrence and therefore farmers should prepare themselves for it. And so they should, but they would like a little bit of help to make that possible. To encourage them, as this package does, is something that we should all be very pleased with.

When we came to office last year, we found that our packaging costs were 40 per cent higher than in Europe or in the United States; we found meat processing costs in our best plants were three times higher than those in the United States equivalents and almost twice those in New Zealand; and we found that it cost twice as much to transport grain here than it did over similar distances in the United States and even in the UK. In fact, if it were not for the National-Liberal party coalition, then in opposition, proper drought relief payments would never have existed. It is as simple as that. We can take a substantial credit for embarrassing the previous government into taking the very important and difficult decision it was for them and the costly decision it was for them—but it was in the interests of all the Australian community that that was done.

Finally, for the cynics and knockers who believe that farmers do not deserve help and that assisting primary production is a waste of time, I say to them, `Well, you're simply wrong.' The editorial in the Financial Review of 16 September is a good example of the writers being patronising. It begins: `How do you wean farmers off their welfare mentality?' It goes on to accuse this government of `slugging non-farmer Australians to pay for special handouts to farmers'. Can I say that the reporting of rural matters by our major dailies is inadequate and it does them a great disservice.

I give as an example the fact that, between 1990 and 1997—a very difficult time for wool producers—there has never been a credible interpretation and discussion of that issue in any of the major newspapers. I think that is a great mistake. The print media have served Australian farmers particularly badly over recent years. Their reporting is often simply insulting and untrue. As some would say: there is life—Australia's lifeblood—outside the boardrooms of Sydney and Melbourne. The Agriculture—Advancing Australia package does not come out of a vacuum. (Time expired)