Senator HEFFERNAN (3:56 PM) —As the chair of the Rural and Regional Affairs and Transport Legislation Committee, I present the report of the committee on the provisions of the Wheat Marketing Amendment Bill 2002, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

Senator HEFFERNAN —I seek leave to move a motion in relation to the report.

Leave granted.

Senator HEFFERNAN —I move:

It would be fair to say that this committee hearing, which was really about the Wheat Export Authority's levy, has generated a fair bit of interest right across Australia from all quarters of the wheat industry. Most arguments got put on the table and there was a fair bit of conspiracy around that it was somehow going to be an attack on the single desk. Early in its deliberations, the committee decided that any debate around the single desk was well outside the terms of reference for this committee. The inquiry was held in Canberra and Perth during March 2003 and included examination of the role of the Wheat Export Authority and the proposed conduct of the 2004 review of AWBI's performance as the current single desk exporter of Australian wheat.

The committee heard submissions from all participants in the industry as well as from the Wheat Export Authority, AWBI and AWB on the role of the Wheat Export Authority from its foundation in 1999 to the present. The submissions included some basic and well-founded criticisms of the performance of the Wheat Export Authority, the effectiveness of its role and doubts as to its ability to properly and fearlessly monitor the activities of the AWBI—the international single desk. As Senator Ferris has just reminded me, there were criticisms that it was in some ways a toothless tiger.

Among the doubts raised was that of the ability of the Wheat Export Authority to obtain all information regarding the operations of AWBI and fully report on them to growers in a timely and transparent manner. Also among the doubts raised was whether the Wheat Export Authority retains the confidence of growers. Some people said absolutely that they had grave reservations about their confidence. Another doubt raised was whether the Wheat Export Authority will be in a position to credibly and effectively conduct the 2004 review of the AWBI's performance as the single desk exporter of Australian wheat. It is very important that whoever conducts that inquiry has to first of all gain the confidence of the industry to give that report credibility when it is produced.

This committee has been a wake-up call for Australia's wheat growers. The wheat industry is constructed in such a way that 20 per cent of our growers grow 80 per cent of our wheat and 80 per cent of our growers grow 20 per cent of our wheat. Most blokes that are in the 80 per cent that grow the 20 per cent are too busy at home feeding sheep, putting in the crop, milking the cows and feeding the dogs to be worried with the detail of what happens at the AWB.

It would be fair to say further that the AWB is a public company that has obligations to its shareholders, which it correctly and unsurprisingly carries out. It also has constitutionally an obligation to the growers. One of the points of contention throughout these hearings has been whether that was a conflict of interest that not only was perceived to be there but was in fact there. It would be fair to say that there were questions raised, especially in Perth, about whether there were any peepholes in the china walls between the two companies, given that all but two of the directors of both companies are the same directors. So there were some questions, and Australia's wheat growers should be well comforted by the fact that this committee has put some pretty fair discussion on the table on their behalf.

There were also questions raised about whether the Wheat Export Authority, in processing applications for export of Australian wheat in bags and containers, needed to be there. Obviously, there is a great need for quality control. Given there were only 150,000 or 160,000 tonnes exported last year in bags and containers, the question raised was whether there is a need for that to be subject to a permit system. Another question raised was whether the Wheat Export Authority should contest the service agreement between AWB Ltd and AWBI with respect to a very large range of noncontestable services provided by AWB Ltd to AWBI. We were given evidence that there was no disaggregation of those services, which made it almost impossible—and I guess it is impossible—for the Wheat Export Authority to come to terms with the individual supply of those services, and we questioned whether they are contestable and whether they are actually getting good value for money. A particular concern in this regard is the funding of the following services provided by AWB Ltd to AWBI: transport, freight handling, financial services, currency arrangements, market analysis and related commercial advice.

In addition, the committee is concerned that growers better understand the arrangements for the operation of the Australian Wheat Board's Geneva desk and its role, funding, administrative and cost oversight arrangements. The committee has—and I emphasise this—a long commitment to the statutory position of a single-desk exporter of Australian wheat. There has been widespread support for that. Some presentations have been made in understandable self-interest against that position, but there is widespread support. It is fair to say that the average wheat grower wants a fair season, wants to grow a good crop, wants to have a clear harvest, wants to safely store that wheat and wants to get the maximum price for that wheat with the least cost. The great danger for Australia's wheat growers is that, if there is no continuing scrutiny—and it is fair to say that scrutiny is required—then, like some other institutions, such as the NRMA, who forgot that they were there just to fix broken-down cars, the Australian Wheat Board could easily lose sight of what it is really there for. I emphasise that this report does, however, set out some steps which can be taken to provide for a better and more transparent oversight and eventual review of the single desk arrangements.