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Wednesday, 7 March 2001
Page: 25231

Mr O'CONNOR (10:50 AM) —The Pig Industry Bill 2000 gives legislative effect to a long process of consultation between the pig industry and the government over a new industry services body which will combine the functions of three discrete bodies into one for strategic policy development, marketing and research and development purposes. The new not-for-profit industry services body whose establishment we are debating in this legislation will take over the assets, liabilities and staff of the Australian Pork Corporation and the Pig Research and Development Corporation and will also take over the strategic policy development role of the Pork Council of Australia.

This particular bill marks a significant change in industry structures within Australian agriculture. It is not without its particular concerns for the opposition, which I will detail to the House as we move through debate on this bill. As far as the bill is concerned, all statutory levy payers will be eligible to register to become members of the industry services body and will have full voting rights. This will be a company that will be structured under the existing Corporations Law to carry out those functions that I have mentioned previously.

The bill provides for the minister to enter into a funding contract with an eligible body, to enable it to receive and administer industry levies collected by the Commonwealth and those matching funds which are provided under the existing arrangements between the Commonwealth and the pig industry. The minister may declare the body with whom the contract is made to be the industry services body. This particular structure is outlined in detail in the legislation. Further details of the accountability to members and the Commonwealth are outlined in the contract between the Commonwealth and the industry and the constitution of the new body, both of which the opposition are yet to see. If the company changes its constitution in a way considered by the government to be unacceptable, becomes insolvent or fails in any way to comply with that contract, the minister may suspend or terminate payment of statutory levies and matching grants to the company. The minister may also rescind a declaration that a company be the industry services body. As far as this piece of legislation goes, this is the ultimate sanction by a minister of the Commonwealth on an industry body which, from this day forward, will stand outside the ambit of the normal statutory corporations that the Commonwealth sets up and deals with. This body will become a company under Corporations Law and will, in a sense, be at arm's length from the Commonwealth and parliament in that regard.

I am pleased that the discussions that have taken place between the industry and the Commonwealth have dealt with the matter of employee entitlements for the people who will be transferred from the three bodies I mentioned previously to the new entity. Accrued entitlements of employees of those former statutory authorities, including annual and long service leave, continuity of service and other employment conditions, are recognised in this bill. I do comment on the integrity of the process of consultation that has taken place within the industry in bringing it to this point and between the industry and the government. I pay tribute to the former head of the Pork Council of Australia, Ron Pollard, and his executive officer, Brian Ramsay, and the work they have done on behalf of their industry. We have had very productive consultations with them over a long period, as has the government. I know the new company that is being constructed is close to Ron Pollard's heart. We do not guild the lily in this chamber; we do have serious concerns about the direction in which the industry is heading under this new structure. Those concerns have been articulated to industry leaders at various times. Time will tell how this new structure is able to operate effectively on behalf of pig producers in this country.

It is with some regret that I inform the House that the opposition will not be supporting the passage of this bill through the House at this stage. For the benefit of pig producers, their families and industry representatives who have put so much time and effort into bringing the industry to this point, let me explain carefully why the opposition has taken this course of action. The restructuring proposal for the pig industry now before this House represents one of the most radical changes to the institutional structure governing any industry in this portfolio in recent times. It combines marketing, research and development and industry services functions which hitherto had been performed by three discrete institutions, forming them into one body. Those three organisations represented distinct functions, funded and administered in separate ways.

The new corporation, Australian Pork Ltd, will be the recipient of significant public moneys to assist it in successfully carrying out the functions designed for it in this legislation. The proposition I put to the industry representatives was therefore a simple one: support for this legislative proposal from the opposition would be contingent upon the opposition receiving a copy of the contract to be entered into between the industry and the government, detailing the manner in which the industry will be held accountable for the taxpayer funds it will attract under its new corporate structure. We have also requested a copy of the proposed constitution of the new corporate entity to ensure, as best we can, that it reflects equitably the wishes of industry representatives and the aspirations of pork producers.

In my view, this was not an unreasonable request to make of the Minister for Agriculture, Fisheries and Forestry and the government he serves in this place. As the industry and producers are well aware, the minister announced in his statement of 29 August 2000, on behalf of the government, his approval for the formation of Australian Pork Ltd. Yet here we are in March 2001, some six months later, and the opposition is yet to view the essential documents which form the basis of the new corporation and give effect to radical reform of this very important agricultural industry in regional Australia. For the information of pork producers and their industry representatives, a final departmental brief on these matters was delivered to me and to my parliamentary secretary, Senator Michael Forshaw, and to other Senate colleagues and staff, only at 5 p.m. yesterday, with the bill up for debate in this House this morning. When I requested a copy of the draft documents, the contract of agreement and the constitution of the new corporation, the minister's staff declined to make them available. Before I had to leave the briefing due to a division in this House, I was informed by departmental staff that the documents had not been finalised—they were 95 per cent, but had not been finalised. At the eleventh hour, negotiations were still taking place between the minister's department and the industry on the substance of the legislation which is now before this House.

I say to pork producers and to their representatives that I was not surprised at what we would term the latest bout of incompetence from this government. It has happened before. It happened before the presentation of the wool and horticulture bills to this House. Regrettably, we now have a hapless National Party minister and a hopeless coalition government, a panic-stricken government that is now more intent on its political survival than it is on good government. The Howard ministry is coming apart at the seams. Of course, the Western Australian and Queensland election results have generated open hostility now between Liberal Party and National Party ministers and members.

Mr DEPUTY SPEAKER (Mr Nehl)—Order! I should remind the member for Corio that the particular legislation we are discussing is the Pig Industry Bill 2000, and problems within the coalition have no relevance to it. Please confine your remarks to the bill.

Mr Bevis —Very sensitive.

Mr O'CONNOR —I note your sensitivity, Mr Deputy Speaker, but—

Mr DEPUTY SPEAKER —Order! The chair has no sensitivity; the chair only has feelings.

Mr O'CONNOR —I accept that fact, but I prefaced my remarks on this bill by saying that at the eleventh hour, yesterday at 5 o'clock, the opposition had not received the draft documents relating to this very essential piece of legislation and most important reform in agricultural industry. I say to you that sitting there like a rabbit in a spotlight, quivering with panic and paralysed by his own incompetence, is the minister for agriculture, the member for Wide Bay—

Mr DEPUTY SPEAKER —The member for Corio will withdraw that reflection on the chair.

Mr Bevis —It was not, if you listened to what he said.

Mr DEPUTY SPEAKER —I listened to what he said. I am not going to embark on discussion with the member for Brisbane.

Mr O'CONNOR —Mr Deputy Speaker, I said—and I will repeat what I said—that there, sitting like a rabbit in a spotlight, quivering with panic and paralysed by his own incompetence, is the minister for agriculture, the member for Wide Bay. Those are the words that I used in this debate. I am mentioning this because here we have a significant piece of rural legislation, probably the most radical innovation in the structures that deal with research and development and institutions in Australian agriculture. The point I am making to the pork industry and its representatives is that the opposition has not yet been able to view the basic documentation. The final brief on this legislation was delivered to me last night at 5 o'clock, but the departmental officers told me I could not have those documents because they were still the subject of negotiation with the industry. On that particular point I rest my case.

I am not asking the minister to do a backflip and provide us with information; I am asking him to do a front flip, to do the decent and professional thing and ensure that the processes of the parliament are enhanced by the provision of important and essential information. Members of the industry might say, `Pigs might fly,' but really I think it is a bit rich to ask the opposition to just say yes to a piece of legislation when it has not had the benefit of scrutinising what is a very detailed contract and a very important corporate constitution. It is not a big ask, unless of course you are asking a hopeless and incompetent government.

Let me put the facts on the public record for pork producers, processors and all others associated with this particular industry. I have maintained an open and honest dialogue with the pork industry on this matter. The representatives of the industry have had unfettered access to me, to my shadow parliamentary secretary, Senator Mike Forshaw, and to my Senate colleague who has a longstanding interest in this industry, Senator Kerry O'Brien. We have had some serious reservations about the final structure and about some of the details of the overall proposal. However, the opposition has respected the integrity of the proponents and the process of consultation that has brought pork producers to this collective understanding and support for the direction in which they want their industry to go in the future. I am sure all fair-minded producers and others associated with the industry will understand the untenable situation that the opposition has been put in by the minister and the government. I do not intend to compromise the position adopted in the past in similar instances where the processes of the parliament have been treated with contempt by this government. That is why at this stage the opposition will not be supporting the passage of this legislation through the House.

The pig industry, like many rural industries in Australia, has undergone significant structural change in recent decades. Between 1960 and 1969, for example, the number of pig producers fell from 50,000 to just over 3,000. At the same time the average herd size and productivity in the industry increased significantly with pig meat production almost doubling. The industry has been confronted with a whole lot of issues that it has had to grapple with, both in the political arena and in the quarantine arena. As well, there have been food safety issues and trade issues. It has been a very difficult time for producers in this industry.

The considerable pressure to change over the last two decades has come about as a result of a number of factors: the declining domestic market for pig meat, declining returns to producers, which have been a significant factor in this industry, increased competition from imports, and the existence of a very small export market. That last factor we have seen turn around in recent years, particularly in the last 18 months. We have seen the pig industry take the export opportunities that have become available to it, especially in markets in South-East Asia. I make no comment on the circumstances that have given rise to that surge in exports but, to the industry's credit, they have turned this industry from one with a very small export sector to one which is export oriented and which seeks to take advantage of the developments that have occurred to our near north.

The federal government provided a $24 million package of assistance to the pork industry which was allocated along the following lines: $9 million to the National Pork Industry Development Program; $2.6 million to the Singapore Pork Market Alliance Program; $8 million to the Pigmeat Processing Grants Program; $1 million to FarmBis Training Initiatives for Pork Producers, called Pork Biz; and $3.4 million to assist those pork producers who through economic circumstance had to leave the industry to exit it with some dignity. We on this side of the House have no quarrel with the government on those measures. Indeed, those measures have been of particular assistance to the pork industry in capturing those new markets and preparing producers to take advantage of their new market circumstances. We give credit where it is due. This industry package is broad ranging, it is multifaceted, and it is aimed at encouraging this industry to change its direction, to change its culture and to strengthen its commercial viability in the long term.

However, I wonder, given that the government could structure a program of this type for the pork industry, why it was not able to do that for the dairy industry. As we know, the dairy industry has been the recipient of $1.7 billion of funds in the form of a compensation support package for dairy farmers. The essential elements of an industry plan that are evidenced here in the pork program are certainly not evidenced in the policy response to the changing needs of the dairy industry.

As we know, there are very strong synergies between the dairy industry and the pork industry. If we go back some 30 years, we find that many dairy farmers raised pigs as a sideline. It was a very important part of their total farm operation, just as many dairy farmers in my family were croppers. I see the honourable member for Corangamite sitting in this chamber today. He was a sheep man from the Western District. That is about all they knew out there; that is probably all the land might have been good for. I know that he will get up in this debate and challenge that proposition. But in other areas dairy farmers did turn to other pursuits. Pigs were a very important sideline, and cropping was another.

So in this pig package we have the elements of a good industry plan. I am puzzled why the government did not adopt this approach when they looked at the dairy industry. We did point this out to them when this industry package was put on the deck, but they ignored all of that. But to give credit where credit is due—we can always argue about the funds—certainly in the elements of this package the government picked up many of the things that should have been done in the dairy industry but were not.

As far as this legislation is concerned, I go back to the point at which I began my address to the House. This structure represents one of the most radical changes we have seen to a rural industry organisation in Australia to date. Inherent in this legislation and in the supporting documentation—the contracts of agreement between the Commonwealth and the industry and, to a lesser extent, the constitution of the new body—is a requirement that the industry not engage in political activity. I can understand why the government is very sensitive on this matter. As members will recall, the industry was heavily engaged in political activity in an election in our not too distant past.

There is always an inherent danger in combining all these functions into one organisation. Organisations always run the risk when they do this of having their political voice muzzled by a government intent on using the resources that it allocates to the industry as a lever to get political compliance. We have had reservations about combining marketing and research development organisations in the one body, and I flag these to the industry. If we go back and look at the structure of these bodies in the past, the most effective ones seem to be those that work with these functions separated. But to combine the strategic development function of a producer organisation with the marketing and research function is, in our view, a very difficult thing to achieve.

I wish the pork industry well in this pursuit. I know their hearts are in the structure that they have put to their members and they are intent on trying it. But there are many examples in rural history where attempts at this have led to disaster. I say to the industry that we have some grave reservations about the structure which is being adopted today. As far as the political dimension to this structure is concerned, I suppose I stand here as somebody who will more than likely—if today's polls are any indication—occupy the position of minister for agriculture in a Labor government. I might take some comfort in the fact that, in this legislation, there are procedures put in place that severely inhibit an industry from engaging in political activity.

However, I can also take another view on this and put the view to the House that it is a bit like the attempts to get on top of the black market economy through the taxation system and a GST. I was sitting with the Australian hoteliers this morning at a breakfast when they told me that the black economy is rampant and the GST has done nothing to address the issue. I guess it is not beyond the wit of pork producers, in the face of this piece of legislation—where they see particular strictures put on their organisation from engaging in certain political activity—to structure another organisation which will carry out that function outside of the legislative framework. We know this occurs in industries because we have an example, as I speak today, in the dairy industry. There are certain representative structures, if you like, for that industry. We have now seen dissident elements coalescing around some anomalies and failures in the package to form a new producers organisation which is very political and has many National Party members in regional seats shaking in their political boots.

Having said all that, I do understand the desire of the industry to have the particular structure that they are proposing legislated and I wish them well with that new structure, once this piece of legislation moves through the parliament. But I say to the industry—and to the government as well—that, if the industry want the cooperation of an opposition, I think it is reasonable to expect that the very basic documents, even in draft form, that give expression to the detail of how the government intends to structure this new radical corporate structure and rural organisation, and how it is going to relate to the government, be given to the opposition.

I do not think it is an unreasonable request that the opposition be given the draft documents and at least have an opportunity to comment on them. If the pork industry were to go to the wool industry and the horticultural industry they would find that, as an opposition, we conducted our discussions with those industries with integrity and good faith. We were not out to bring the government down over a horticultural bill. We were not out to bring the government down over what it was proposing in the wool industry. But we were demanding our right, as an opposition, to scrutinise the basic documents that give effect to the most radical change we have seen between the structure of an industry body and its relationship with government. That is not an unreasonable request. It is one that has not been met by the government, much to my disappointment and, I think, to the industry's disappointment as well.

With those concluding remarks, let me say that, for the reasons I have outlined, the opposition will not support the legislation at this stage of the proceedings of the House. I do expect that the minister will make available to the opposition in a reasonable amount of time those basic documents for scrutiny. We will engage in negotiation and discussion with the industry in good faith. For example, unlike the horticultural services bill 2000, this bill does not make provision for a decision by the minister to rescind a declaration as a disallowable instrument. (Time expired)