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Foreign Acquisitions Amendment (Agricultural Land) Bill 2010
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Heffernan, Sen Bill
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Thursday, 22 September 2011
Senator HEFFERNAN (New South Wales) (17:20): It is a very rare occasion that I rise in this place and I have noticed that most speeches made in this place are valued by the time they take up rather than their content. Thank you for that great contribution in time there, Senator Farrell. I have two words prepared here as my notes. The Foreign Acquisitions Amendment (Agricultural Land) Bill 2010 has great merit in that we are talking about agricultural acquisition by foreign interests. It puts it on the notice board. I am chairing an inquiry which will report next year on what is going on. It needs to be put into context. We can no longer take for granted what we have taken for granted over many years. That is to do with the shrinking agricultural resources of the planet and the compounding population growth of the planet. To have the argument about how we manage that, we should get the bed stones down. By 2050, unless there is a global catastrophe of some sort, we are going to have nine billion people on the planet and, according to the science, 50 per cent of the world's population will be poor for water. All science has vagary, so obviously we will have to make allowance in any plan for that vagary. It is estimated that a billion people will be unable to feed themselves and 30 per cent of the productive land in Asia will have gone out of production. Two-thirds of the world's population will live in Asia.
The global food task will double by 2050 and 1.6 billion people on the planet could be displaced. Part of that displacement is already underway. Unless China engineers a water solution for the great northern plain, where 260 million people presently live—food production in that region uses water from the great northern aquifer—they will have to move. By 2050 the number living on the great northern plain will reach 400 million. China are engineering some water solutions. They are building a pipeline to move water which is over a thousand kilometres long, has 27 pipes laid side by side and is 4½ metres deep. They say if you have enough money, you can engineer anything. That is part of what they see as the solution. I guess one of the reasons they are hanging onto Tibet is that Tibet is a great water supply—it is more about that than anything else.
By 2070 the world will have 12 billion people, barring a catastrophe. China will have around 1.8 billion people. China is through the denial phase on their problem—unlike India that are still in denial and unlike Australia that do not even think about it. We only worry about where we are going to be in the paper tomorrow and at the next election. That prediction of 1.8 billion people in China will include a huge demographic of aged people. Based on their own estimations to feed their people, China have set aside 200 million hectares for prime agricultural production. You cannot buy land there. It is impossible to acquire freehold title in China if you are a foreigner—forget about it. But they know they have already lost 10 per cent in 10 years of that set aside agricultural production due to urbanisation and the problems of water. They are on the move globally to fix that problem as a sovereign solution to protect their sovereignty, control their destiny and control their food task.
They are on the march on the continent of Africa. A further part of the human displacement by 2050 will be about 260 million people who live across the northern part of the continent of Africa, which will become a desert according to the science predictions. The south-west portion of Western Australia is going to fall into the same category, according to the same science. The Murray-Darling Basin has 23,400 gigalitres of mean run-off. I hear people slagging off in this chamber trying to make cheap political points about the Murray-Darling Basin Plan. Bad luck, folks, Mother Earth is the referee of all this. The science is telling us that Mother Earth could remove somewhere between 3,500 and 11,000 gigalitres from the Murray-Darling's run-off due to a two-degree increase in temperature. A 15 per cent decline in rainfall in the southern Murray-Darling Basin will relate to a decline in run-off of up to 35 per cent. In fact, the three years of snow previous to the last year did not actually melt, it evaporated.
The science says that by 2050 we may have under a fortnight of snow in the Snowy Mountains. Thirty-eight per cent of the run-off from the Murray-Darling Basin comes from the two per cent of the landscape that is at the back of us here in Canberra—between here and northern Victoria. So what happens in that particular bit of the landscape quantifies what will happen to a lot of the Murray-Darling Basin. In fact, if the science on the changing weather for Australia is 40 per cent right, in most years there will be zero allocation for general purpose water in the southern rivers of the Murray-Darling.
These are all propositions, and here we are luxuriating in this chamber while trying to score political points on how to manage the Murray-Darling Basin. I do not have the time tonight to go into this because it takes me two hours to do the presentation on the planet's water and Australia's water, and what we should do about it. But we can actually fix the water problem by fixing the model for water entitlement. As the amount of water available falls, you do not have to have a sledgehammer that says, 'We're going to take between 3,500 and 7½ thousand gigalitres out of the system'—which would be the top of those variation years; you can have an entitlement system which we have now instead of a volumetric licence system. As the amount of water available in the system for that year falls disproportionately, the amount of water that has to go to the work and the freight of the river increases. You can actually model that, but no-one has bothered. They are too lazy. Every government of every persuasion, for all time, has buggered up the management of water.
The world is losing one per cent of its agricultural land every year for a number of reasons. Under the science that is predicted, some agricultural land that is unproductive now will come into production and that could include parts of the frozen continent to the north. It will certainly mean changed propositions in Northern Australia. You will have heard Stuart Blanch and Joey Ross and those people in recent days slagging the idea that somehow we can develop Northern Australia. If we are silly enough, as we appear to be, to say there are no development opportunities in other parts of Australia and the science is telling us there is going to be a decline in capacity in the south, and we all rest on our laurels, think of the past, retire to the coast, think agriculture is a mature industry and we only go to Coles, Woollies or Aldi, or wherever, to get our tucker because it is all there, we are dreaming.
By 2050, the food task is going to double. We are going to have to use everything from GM science to smarter technology for water. In Australia, we have a perfect model for efficient water use in Carnarvon in Western Australia. I congratulate Judith Adams for being in the chamber. Carnarvon farmers are 40 times more efficient with their water use than the Ord. They are 20 times more efficient than the Murray-Darling Basin. In 2006-07, they produced $69 million of income from 8½ gigalitres of water—and some of that went to the town supply. Their pressurised root zone irrigation system is based on Spanish and Israeli technology. In the same year, the Ord in stage 1 used 345 gigalitres of water to produce the same income. In the same year, the Murray-Darling was 20 times less efficient.
There is some efficiency that can be applied. That efficiency can be brought to bear in the Murray-Darling Basin. The episode with Cubby—and I think that is about to be fixed—was seriously inefficient. It was the model of a great idea built on the wrong scale in a river system, the Culgoa River, that has 1,200 gigalitres of mean annual flow and 845 per cent variability. They allowed them to build 1,500 gigalitres of on-farm storage, which is completely out of kilter with the capacity of the river system. That is just a little bit of detail on what agriculture is all about.
We produce 73 per cent of Australia's farm income on agriculture in the Murray-Darling basin, which has 6.2 per cent of Australia's run-off. The Timor catchment has 78,000 gigalitres of run-off, the Gulf catchment has 98,000 gigalitres of run-off and the north-east catchment in Queensland has 85,000 gigalitres of run-off—and here we are dreaming that we do not care who owns the place. If I have time I will come to the details of the farcical statistical evidence the ABS gave on ownership. It was a complete, drop-dead farce.
Here we are fantasising about locking up the north when we know that Bangladesh is half its size. Cape York Peninsula is 17½ million hectares. If you take out the coastal communities, there are approximately 14,000 people, 12,000 Indigenous, living in an area the size of Victoria. There are 800,000-odd feral pigs there, 20,000 to 30,000 untagged feral cattle and about 14 to 17 pastoral stations. The rest is either sit-down blackfella country—I can say that because they are all my mates; and I am a whitefella to them—or destined for World Heritage listing.
To his credit, Peter Beattie told me, when I was in the process of chairing the Traveston Dam inquiry—and, by the way, it was a shit of a site for a dam, and he knew it—
The ACTING DEPUTY PRESIDENT ( Senator Furner ): Senator Heffernan—
Senator HEFFERNAN: I retract whatever it is you want me to retract.
The ACTING DEPUTY PRESIDENT: You know what you said and I am asking you to retract it.
Senator HEFFERNAN: I retract it. I had better not say 'bugger'. It was a 'not a very nice' site. He said, 'Look, Bill, I've got to get the inner-city preferences'—this was two elections ago in Brisbane—'so I've done a deal with the Wilderness Society to enact the wild rivers legislation.' The wild rivers legislation locks up the first kilometre on either side of all those rivers all the way up Cape York Peninsula—17½ million hectares. The average annual wildfire there burns five million hectares. The biggest wildfire they have had burned 11 million hectares. It is a soft entry point into Australia for foot and mouth disease because of all those feral pigs. We are fantasising about locking it up. So the opportunity for Indigenous people up there will not be economic agricultural production for the first kilometre, which is just as good as any riverbed or floodplain down the Murrumbidgee. No, we are saying: 'What we want your opportunity to be perhaps is tourism. You can get your picture taken standing on a stone with a spear for the tourists.' That is what we are saying to our Indigenous people. And bear in mind that there are still approximately 7½ thousand kids in the Northern Territory who do not have a bloody high school to go to. What sort of a disgrace is that?
Go to Bangladesh and try to explain that to the people in Bangladesh. It is predicted that 1.6 billion people on the planet will be displaced by 2070. If the science is only 10 per cent right, that is 160 million people. Bangladesh has 160 million people who live in an area half the size of Cape York Peninsula. Fifty-seven rivers flow into Bangladesh, 54 of them out of India. India is mining the water that comes all the way along the Ganges—right down. India is still in denial. If the sea rises just under a metre and India continues to mine the groundwater which becomes the river water for Bangladesh, by 2050 those people are going to have to move because they are going to be inundated and lose their freshwater—and here we are fantasising about not developing anything in the north.
The CSIRO were not allowed to consider storing or damming water, but that was not because they could not do it. Better than anyone in this chamber, I understand the science of what is happening up there. The bulk of the water falls to the bottom of the catchment, unlike the catchments down here where the water falls to the top of the catchment. It is an event based thing, but you can recharge sandbed aquifers—the Gilbert River west of Georgetown was pegged out for irrigation in 1957.
We have all said: 'Oh, no, it's too hot to go up there. And it's too far away from the market.' Where's the best place to be on a hot day? In the cab of a tractor. It is better than the airconditioning in the house. Why do we think we are we too far from the market? Because we are looking in the wrong direction. Two-thirds of the world's population are just over the water. Two-thirds of the world's population are closer to Darwin than they are to Sydney.
So here we are thinking that somehow we are going to flog through with what we have got. No-one is listening to the science in this debate about agricultural land acquisition. We were briefed the other night by the ABS, and I took the trouble to ring them. As they will tell you, the game has changed. I have heard all these political speeches today—mostly prepared notes that someone else has written for them—but no-one is giving consideration to the seismic change that is occurring in the world through the loss of sovereignty through modern communication, transport, free trade agreements and all the rest of it. And that was my point to Senator Farrell on the free-trade agreements: we gave away a five per cent and a 15 per cent tariff in the American free-trade agreement and imposed a 45 per cent tariff. In 2004, when that was agreed to, we were at 67c to the US dollar. When it was enacted, in January 2005, we were at 70c. We now have a 45 per cent tariff against us on our terms of trade, yet we gave away a five per cent tariff. It is all stupid.
It is premature, this bill. I am sorry, Senator Xenophon, but it is premature. Let's get everyone educated as to what the problem is and let's have a strategic view in Australia of where we are going to be in 50 years time and in 80 years time. Let me give you some suggestions on that. There needs to be true definition of the difference between foreign sovereign acquisition—and the ABS will tell you this if you go and talk to them—and foreign capital. I do not care about foreign capital coming into agriculture because it has been coming in for yonks. Traditionally what happens with foreign capital is that they come in, invest, feel good about it and then strike the variability of our seasons and its impact on production. Next, all their directors want a bonus, overtime and all the rest of it and then they go broke and they pack up and leave. It always happens. They all do it. One of the great institutions of Australia, the family farm, keeps the job going because we do not pay ourselves overtime.
Why shouldn't we be thinking, 'Let's sell our production into the doubling of the world food task by 2050 rather than sell our means of production'? I am sorry to have to use a note at this stage, but I will just quote ABARES talking about who owns the place. This is from the report of the Senate Economics Legislation Committee's inquiry into this bill. First there are some comments from Alan Hill, the Director of Policy for the Western Australian Farmers Federation, then the report goes on:
ABARES also noted that there is currently no database of ownership of Australian agricultural land—
this is only a few weeks ago—
It informed the committee that Queensland is the only State that collects this type of information:
Senator HEFFERNAN—Firstly, would it be fair to say for your organisation—
this is ABARES; they advise the government—
that we really do not know who owns the agricultural land in Australia?
The ABS thing is a political cover. We were briefed on it.
You know what they did? They sent out 11,000 forms based on the ATO's ABN register of agricultural interests. They did not pick up Shenhua, who bought a big lump of country around their mine to shut all the cockies up. They did not pick up all the blind trusts through the Cayman Islands. They did not pick up the sovereign wealth funds where reporting is compulsory but not mandatory. Some of these sovereign funds have all sorts of blind operations. No, we do not know about the sovereign acquisitions.
The greatest threat to Australia's sovereignty, as Mick Kelty pointed out a few years ago—no-one took any notice—is the effect of climate change and human displacement. The greatest threat now—and if you dig down into ABS, they will tell you—is the concept of sovereignty being displaced because of sovereign wealth funds. The sovereign wealth funds of some countries are acquiring the sovereign wealth of other countries—and excluding those countries from access to their own wealth. That is going to happen—places like China, to their credit, are aware of the future food problem they are facing and they are busily doing this.
If you go back to the ABS thing, the database—guess what? They started with farms that had an income of $5,000. So farms with an income of only $5,000—that could be any of these toy farms around Canberra here—were included in the schedule as some sort of commercial agricultural production. You have to have income of between $30,000 and $50,000 to be able to get a GST return—$5,000 is meaningless. Yet, in the statistical database, the model includes anything that earns $5,000. This has the capacity to completely distort the figures. This is a phoney—I am sorry to have to say that, but it is—statistical, political tool. It is meaningless. Hopefully, when the inquiry that I am going to chair gets going, we will deal with the facts rather than the political fantasy involved behind protecting a government—whoever the government might be after the next election.
I am interested, and all of Australia's farmers are interested, in where we are going to be in 50 or 80 years time. We do not want to leave the farm to a foreign interest if we can avoid it. But you cannot blame the cocky who wants to get out— (Time expired)