Mrs STONE (8:36 PM) —I rise to support the excellent Social Security and Veterans' Affairs Legislation Amendment (Retirement Assistance for Farmers) Bill 1998—a bill which the honourable member for Jagajaga (Ms Macklin) has just described as a `Clayton's activity'. That is not surprising, of course, because the opposition has shown itself to be singularly out of touch and beyond all understanding of what goes on in regional Australia. It is amazing that the honourable member for Burke (Mr O'Keefe) was so out of synchronisation, arguing about a totally different scheme. He suggested this bill was already in action and only a handful of farmers had been able to take advantage of it. I hope he very quickly does his homework before he gets back to his electorate.

A retirement assistance scheme for farmers is essential for Australia and, of course, most important for the electorate of Murray. The 1996 census figures indicated that 21.7 per cent of all those employed worked in primary production in Murray and 40 per cent of all families there had a weekly family income of less than $500. Only 6.4 per cent have a weekly family income of more than $1,500. It is an electorate of affluence in some areas but one of seriously low incomes in others, in particular in the section of the electorate that is primary production dependent. The contrast of high and lower income families is especially marked in the agriculture sector throughout the electorate.

We are a very productive region, generating billions of dollars in export earnings annually. However, like primary producers throughout Australia, Murray's farmers are largely price takers in international markets where government intervention is commonplace, creating subsidised competition and non-tariff barriers. That makes it very difficult to compete. Margins in farming are cut to the bone and have been for more than a generation. It is not easy to survive in agribusiness today.

The foreword of the ABARE report entitled Issues in the delivery of Commonwealth social support programs to farm families encapsulated the need for adequate social security assistance for some farm families. It stated:

Low commodity prices in the early 1990's, combined with widespread drought in 1993-94, continued the long downward trend in net value of farm production and income in Australia of the past four decades. This accentuated the need of farm families for fair and equitable access for social support programs provided by the Commonwealth Government.

This bill is about dealing out some equity for low income, aged Australian farmers. It is not about charity. The scheme can be justified on humanitarian and economic grounds. It is certainly not a scheme dealing out special favours to all Australian farmers—that is why of course there are conditions. We are responsible in the way that we disburse the Australian taxpayers' funds. The Australian farming population is only too aware of the need to be discerning in terms of who is most in need and where this particular scheme needs to apply.

ABARE's 1995 study of the social and financial circumstances of farm families showed that, throughout Australia, 10.5 per cent of people living in family farm house holds were of retirement age and 15.1 per cent of these people were living in sub-commercial farm households. That ABARE study also concluded that, after excluding an average value for the family home, 14 per cent of the surveyed households had assets of less than $350,000 and incomes below $15,000. And remember, the costs of food, fuel, transport, health services, sport and recreation in country areas are substantially higher than in metropolitan areas. The in-depth interviews that ABARE carried out revealed that, in the two years before the study, 21 per cent of all of the low income farm family households had cut back on basic food, and over one-quarter were concerned about making ends meet either all or some of the time. These are the older farming families in low income situations that we need to target with this special scheme.

Why do we have this phenomenon of asset rich and income poor farmers in poverty traps around the country? As well, you need to ask: why should aged, low income farmers be treated any differently from people in any other occupation in Australia? These are very important questions.

The current system is mightily unjust given the income levels I have just described and given that the assets many farming families have simply do not generate the sorts of incomes that you would perhaps expect in some other business enterprise. Under the current system, the one that Labor has been happy to see in place for generations and did nothing to change in its 13 years in government, if an elderly parent gifts more than $10,000 worth of property or assets in one year, the amount over $10,000 is counted as an asset for the next five years when assessing eligibility for the age pension. So we have had this incredible trap.

The next generation, the farmer's sons or daughters, may not be in a position to purchase the property at market value and the farm may not generate sufficient income for the older owners to distribute sufficient income to their sons and daughters, who carry on the everyday work activity of the property. Faced with that reality, too many elderly farmers or individuals have simply not trans ferred the title of the family farm to their sons and daughters, even though that next generation have been the full-time farm workers and part of the management team for decades.

Where the low income younger generation is trying to derive income for the two or more generations—the grandparents or the parents—it is often at a cost well beyond the means of that farm. Investment back into the farm enterprise is stalled. The family farm becomes less viable. The younger generation, in despair, might simply move off the property, seeking employment elsewhere—a better deal somewhere else on a salary. The rural communities then shrink. The stewards of the land become fewer and less able to do the sorts of work that farmers always have done—minding the waterways, guarding the wetlands, trying to preserve the biodiversity and planting the trees that may not show any tangible evidence of maturity for perhaps 10, 15 or 20 years—the work that perhaps will not achieve an income increase for another generation. That sort of work is all stalled when you break family farm succession. In too many cases around Australia, the poverty in which the older generations have found themselves because of the difficulties our social security rules have imposed on them have meant a break in family farm succession.

It is no accident that over 99 per cent of Australian farms are family farms. This is for the reasons I have just referred to. Farming in Australia is not a high return business in so many of our farm sectors. The work that one generation does is often to be reaped as a reward by the next generation. In particular, the work we do today on tree planting and underground water system management in rural Victoria, in northern Victorian with its high watertable, is work that has to be done today but for which we will not reap the benefits for another 10, 20 or 50 years.

This scheme would never have been introduced by the opposition. We have heard tonight the cynicism, as they described the scheme as `mickey mouse'. The member for Jagajaga (Ms Macklin) said that it was a mickey mouse scheme designed to appear as if we are giving assistance to farmers. I ask: what did they do? People throughout Austral ia, particularly the older farmers, are grateful to see this scheme being introduced as some recognition of their extreme distress.

Labor has consistently demonstrated a profound lack of understanding of the social structures, the economic realities and the environment sustaining work of the people who live outside Australia's capital cities. Farmers' livelihoods involve the day-to-day management of over 70 per cent of the Australian land mass. Remember the feigned outrage of the opposition when it occurred to it that the Natural Heritage Trust funding had predominantly been allocated to help sustain and improve the forests, lands, waterways and river basins; and—surprise, surprise—these make up regional Australia. Yes, rural electorates have consistently voted for the Liberal and National parties. And regional Australia is where these natural heritage phenomena are to be found. Is the Labor Party telling us that, if it had been in power, it would have allocated the Natural Heritage Trust funds on a per capita basis to the populations in the built-up, man-made environments in the cities?

How can Labor argue that this legislation before the House tonight is anything but enlightened and long overdue?

This government's special rural task force were asked to investigate the impact of the social security assets tests on customers in rural areas, including how the assets tests affected farmers remaining on small non-viable land holdings which cannot generate income beyond the age pension limit, and the social and economic implications of changing the assets tests rules relating to the intergenerational transfer of farms. In their report, they acknowledged that many needed urgent and immediate assistance—the form of assistance this legislation will deliver. But they also acknowledged that we need long-term holistic approaches to planning for family farm businesses and an integrated whole farm planning process, including developing family agreements for farming together and intergenerational transfer planning.

Our government's Agriculture—Advancing Australia package has a range of programs designed to assist farming families to progress throughout their farming enterprise so that farm succession can occur without some perhaps getting into the difficulties that this current generation has found themselves in. The AAA package includes such programs as the farm business program—or Farmbis, as we call it—and many rural counselling services, in particular the rural communities program and the farm family restart scheme, which the member for Burke tripped up on.

This government is addressing the realities of our primary industry in Australia. We understand the social structures. We understand the economic realities of having to farm in such a way so the next generation may benefit. When this legislation is enacted, we will make it a cornerstone of greater justice for farm families. I know that today is a very important occasion for farming families and that they are grateful that this government is in power on this day.