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Wednesday, 20 June 2001
Page: 28059


Mr TRUSS (Minister for Agriculture, Fisheries and Forestry) (12:02 PM) — I am frankly appalled by the comments of the previous speaker and, indeed, of many of those opposite, who demonstrated once again Labor's clear lack of regard for the dairy farmers of Australia. Labor has been prepared to do absolutely nothing to assist dairy farmers around Australia. State Labor governments which deregulated their dairy industry have done absolutely nothing—not a cent from Queensland, not a cent from New South Wales, not a cent from Victoria, not a cent from Tasmania. The only government at the state level to provide any assistance was Western Australia, and that was a coalition government that provided some support to the dairy industry in that state. Labor did nothing. Labor has no policy for the dairy industry and Labor has no plan to help the dairy industry. It has been quite clear from the comments of the opposition speakers today that they are acutely embarrassed about Labor's failure to do anything at the state level to assist dairy farmers and by the enormous contrast with what this government has done to intervene and assist in a problem created largely by Labor state governments. We have intervened to assist while Labor has done absolutely nothing.

Look at what Labor's response has been. The shadow minister put out a press statement on the issue several months ago—while the opposition leader was driving around in the boondoggle bus—in which he outlined a plan of action. The plan of action was that they would have a task force under the shadow minister himself. This task force has trotted around to one or two places around the countryside. I am told the biggest crowd they got anywhere was about eight; there was simply no interest in what they were doing. I understand that hardly any of the task force members themselves actually turned up to most of these meetings, just a token representation, and not even the shadow minister sometimes. The reality was that this task force was to have one key function, and that was to prepare a report by the end of April. Well, here we are: May, June, now the end of June, critical legislation on the dairy industry before the parliament, and still no report. So this jolly group of opposition members trotted around the countryside to talk about the dairy industry and has absolutely nothing to contribute, in a major debate, as to where Labor would go in relation to the future of the dairy industry. Even their own amendment fails to address any kind of policy issue.

It was quite clear from the public statements of the honourable member for Werriwa that Labor is opposed to any assistance whatsoever to dairy farmers, and the honourable member for Chifley sailed very close to the remarks of the honourable member for Werriwa. He cannot see why milk users should make any kind of contribution towards ensuring the welfare of the dairy industry around Australia. The honourable member for Werriwa made it completely clear in his media statements that he is opposed to any assistance whatsoever to dairy farmers; and the honourable member for Chifley sailed very close to that theme. What is abundantly obvious from the record of Labor in government—and, after all, there are quite a lot of them in state governments around Australia—is that they will do absolutely nothing.

A number of other totally erroneous comments were made by speakers opposite. The honourable member for Chifley and the shadow minister continue to run the quite ridiculous line that somehow or other the federal government are major tax beneficiaries out of this package. I have heard various numbers for what we will collect: $300 million, $500 million—he makes them up as he goes along. The reality is that this is an issue that has been addressed by agriculture ministers around Australia. An independent report was commissioned from Arthur Andersen and Co. on the tax implications of this package for the federal government. The shadow minister knows, because he has been told many times—and Mr Amery knows, Mr Palaszczuk knows and Mr Hamilton knows, and I am sure they have all told him as well—that the report came back and said that there were no windfall tax gains for the Commonwealth out of this package, that it was revenue neutral. That is an independent report from Arthur Andersen and Co. So don't keep peddling information that you know to be false; it is completely inaccurate.

The other point we get peddled frequently by members opposite is that somehow or other this money, this near to $2 billion that has been provided to the dairy industry, has miraculously appeared and that the Commonwealth has no responsibility for the provision of those funds. The reality is that this money is being paid for by Commonwealth taxpayers in the same way that all other Commonwealth programs are paid for by taxpayers. The clear bottom line is that governments do not have money of their own—not governments on this side. We balance our budgets. Labor governments spend on the never-never: they run up bills, they run up the Bankcard bill and they do not care about who is ever going to pay. They ran up $90 billion worth of debt. On this side we pay our bills, and the only way that we can pay our bills—the only way any government can pay its bills—is if we collect taxation revenue from the people of Australia. In this particular case the tax is a special tax: it is being imposed on milk, just as we impose taxes on petrol, we impose taxes on goods and services and just as Labor, when they were in government, imposed a whole stack of taxes on all sorts of products, on goods and services. Labor imposed those sorts of taxes. This particular benefit to dairy farmers is being paid by way of a levy on milk consumers, and of course that is the way all programs have to be funded.

The reality is that dairy deregulation was driven, as I think all honourable members know, by the desire of the industry to move towards a new environment, and when the opposition moved in their second reading amendment complaints that the government have no long-term plan for the dairy industry they demonstrate again their total lack of understanding. A task force has been rushing around the countryside, and they still have not come across anything of the dairy industry's plan for its future. Our vision for the industry is for it to develop into a highly competitive export oriented industry, and there is already plenty of evidence of the success of the dairy industry's capabilities to export around the world. Indeed, this year most dairy farmers in Australia, despite what we have heard from members opposite, will actually have increased incomes on those they had last year, and it is a result of the outstanding performance of our dairy exporters. It is due in part of course to the improving world prices of dairy products and the capacity of our industry to meet the market opportunities that exist, and that is indeed very much a part of the future of the dairy industry in Australia.

The honourable member for Chifley complained about the `unfairness' of the package, implying that somehow or other this money was going to the wealthy. That is also a nonsense. The reality is that, under this package, five times as much money per litre goes to dairy farmers who are supplying the market milk sector compared with those who are supplying the manufacturing sector. Farmers in that market milk sector have the biggest adjustment pressure. They were the ones in New South Wales, Queensland and Western Australia who had bought quotas and from whom the state governments had actually collected taxes in many instances in relation to the trading of these quotas, so they had significant debts and significant costs in capital investment in their properties. This is where the biggest adjustment has occurred, and the package recognised that by providing five times as much assistance per litre for those who were involved in the marketing sector as those who were in the manufacturing sector.

When it was proposed that we have a secondary package, a state Labor minister, Henry Palaszczuk, actually put up a proposal to ARMCANZ. I might add that all of the other state ministers, including his Labor colleagues, dumped on him heavily because his proposal would have provided the unfair assistance that the honourable member for Chifley was complaining about. He wanted supplementary support, much of which would have gone to Victoria. This new package, the subject of the bill that is before the House, is carefully targeted to those who have to make the greatest adjustment assistance. It is heavily directed towards farmers in New South Wales, Queensland and Western Australia. In fact, only a handful of farmers in the other states will qualify. The reason for that is we recognise that some farmers have had to make a much greater adjustment contribution than others, and this package is carefully targeted in that direction.

The opposition spokesman has suggested that the threshold should have been lowered for eligibility to this second package. To do so would have meant that more money would have gone to those who had a smaller adjustment task. So we have targeted the assistance in this package very much to those who got the biggest adjustment. In reality, the majority of them will be in states such as New South Wales, Queensland and Western Australia.


Mr Lee —In your electorate.


Mr TRUSS —If I may respond to the honourable shadow minister who has entered the chamber and who knows absolutely nothing about dairying, the reality is that the farmers in my electorate will actually get a smaller payout than dairy farmers in other parts of Queensland. The reality is that it is based on the level of adjustment that will be required in relation to the new market arrangements which exist into the future. A point made by a couple of members, including one who is still in the chamber—the only one of the contributors still in the chamber, apart from the shadow minister—was in relation to a handful of Tasmanian farmers.

Opposition members interjecting—


Mr TRUSS —I thought the honourable member may have liked a response to the comments that he made. He raised a number of concerns in relation to farmers in Tasmania, who he claimed were suppliers to the market milk sector but will not receive assistance under this package, and indeed there are some suppliers in New South Wales, Queensland, Western Australia and South Australia who may also meet these criteria. Those producers do not qualify because of the arrangements under the old DMS scheme—the scheme lauded, I might add, by the shadow minister as having been put in place by Labor when they were in office. The reality is that the Tasmanian state government and the Tasmanian industry chose a pooling system in that state which meant that the farmers that the honourable member was talking about were beneficiaries under the old DMS scheme. Under the adjustment arrangements, naturally they would be double-dipping if they were to receive the adjustment payments as well as the old DMS payments. Those rules are consistent with this package, as applied to the previous one.

This legislation provides an additional $140 million of federal assistance for dairy farmers in those communities that have been most affected by deregulation. We have had to provide this additional money because we have given up hope that the Labor state governments will ever meet their obligations to the dairy farmers in those states. The dairy farmers have just about given up any hope that Labor will provide the compensation for quotas that they were asked for and which was very much part of the package that was put to the federal government when we agreed to provide adjustment assistance. Labor have failed to meet their obligations. A range of state budgets have come down over recent days, once again failing to meet their obligations. This additional package, therefore, is targeted to those most in need—as I mentioned earlier, particularly in Western Australia, New South Wales and Queensland.

Of this new assistance, $100 million will go in payments to dairy farmers who are most heavily dependent upon the market milk sector; $20 million will go to people because of extraordinary circumstances, because they were excluded from the previous package, because of anomalous circumstances or because the rules were particularly tight and may have affected their unusual situation; and $20 million will go towards expanding the Dairy Regional Assistance Program, which is doing such excellent work in revitalising many of those communities that have been seriously affected by dairy deregulation. These measures will provide further assistance to farmers. They have been warmly welcomed by the dairy industry.

Whilst nothing can be done to restore the dairy industry to its bygone era—I know there are many who do not wish it to go backwards but want it to go forward and be an outward-looking and progressive industry into the future—this package will help some of those who have been most grievously affected by the states' decision to deregulate their industry. The Commonwealth has helped very significantly. This is the biggest package of assistance ever put in place by a federal government for a primary industry. It has been a monumental effort for the industry and a major initiative—something Labor never did at the state level when they should have, something Labor would never do in the future and something to which many members in the opposition have made clear that they are philosophically opposed. The reality is that we as a government recognise that sometimes assistance has to be provided for industries. We have acted where Labor state governments have failed. Once again, we have demonstrated our compassion and concern for farmers in need.

Amendment negatived.

Original question resolved in the affirmative.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.