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Monday, 22 March 2004
Page: 26844


Mrs ELSON (8:05 PM) —I am very pleased to speak tonight on the Dairy Produce Amendment Bill 2003. As someone who represents many excellent rural areas where there are quite a number of dairy farms, I have a very keen interest in the dairy industry. I have worked with local farmers and rural communities to help them overcome some of the extreme difficulties they have had to face over the past few years due to deregulation of the dairy industry. It has been a tough and challenging time for many, but I am very proud to report that local farmers have risen to this challenge. There has been a huge amount of endeavour, creative thinking and old-fashioned hard work by many people to adjust to the changed conditions and, very often, to find new and innovative ideas for their farms. I will go into more detail about what has occurred in my own electorate later in my speech.

This bill basically makes minor administrative amendments to the Dairy Produce Act 1986 which facilitate the functioning of Dairy Australia Ltd. Dairy Australia is the company that was created in July last year and was formerly known as the Australian Dairy Corporation. Dairy Australia has been responsible for administering the government's Dairy Structural Adjustment Program, just as the Dairy Corporation did before it. This bill contains indemnity provisions for Dairy Australia in relation to the fund. These provisions are standard in commercial environments and are totally necessary to ensure the proper functioning of this company.

The bill also allows Dairy Australia access to additional financial instruments such as options, agreements, securities, currency and futures contracts and currency hedging. This will enable Dairy Australia to more adequately fund the operations of the Dairy Structural Adjustment Program. This bill was developed in consultation with Dairy Australia and the amendments were previously widened and widely discussed in the lead up to their conversion from the Australian Dairy Corporation.

These amendments make sense. They are necessary for Dairy Australia to properly carry out its responsibilities and I am pleased to support them. I am also pleased to take this opportunity to reflect on the changes the dairy industry has undergone in recent years. It is an understatement to say that they have been massive, but it has been a process of change that began well before deregulation. Since 1980 the number of dairy farmers in Australia has halved but the number of dairy cattle has increased, with the average herd more than doubling from 85 to 195. While milk production fell last year for the first time in 50 years, as a result of our drastic drought, it was still nearly double the amount that it was in 1980.

The dairy industry has also greatly expanded its export market. Ten years ago exports accounted for about 40 per cent of production. Today it is a massive 60 per cent. In fact, deregulation was, in a sense, an inevitable part of ongoing changes to that industry. This is evidenced by the words of Pat Rawley, who was then chairman of the Dairy Industry Council. When the Senate report into deregulation of the dairy industry was released in 1999, Mr Rawley's press statement of 21 October 1999 said:

Today's Senate report is a significant document because it ... recognises the inevitability of the deregulation of the dairy industry and the need for a financial package to manage the transition to a fully commercial environment.

He said the Senate rural committee had:

... reached conclusions broadly in line with the AIDC's own analysis of the situation confronting dairy farmers after the end of the domestic market support (DMS) scheme.

He went on to say:

The fact that the report's recommendations were unanimously supported by Liberal, National, Labor and Australian Democrat senators on the committee should be noted.

... ... ...

Its conclusions should finally put to rest the arguments about alternatives to deregulation which have been advanced by a minority section of the industry in recent months.

The fact is that, contrary to some of the scuttlebutt and attempted political point scoring at that time, deregulation of the dairy industry was not something driven by the Howard government. It was not something we initiated or pushed. It was industry driven and ultimately necessary for the long-term good of the industry. The process by which it took place was actually initiated by the various state governments, but we, as the federal government, recognised the importance of the dairy industry to Australia—in value added terms it is our largest rural industry, employing around 60,000 people.

We recognised that dairy farmers would need a great deal of help and support to get through the period of deregulation. We were very determined to do all we could to make sure that farmers had every opportunity to make these adjustments and, if necessary, look at new opportunities in other areas. The $1.8 billion dairy industry adjustment packages consisted of four key programs: the Dairy Industry Adjustment Program, the supplementary dairy assistance program, the Dairy Exit Program and the Dairy Regional Assistance Program. The first three programs provided payments directly to farmers; the last one—Dairy RAP funding—provided assistance to our local communities to help them adjust.

I think the whole package was, and continues to be, a very practical and successful response to a very difficult situation. It reflects the Howard government's focus on local communities. Building communities is a cornerstone of our policy approach. It underpins everything we do. Whereas Labor in government have always been about helping special interest groups and peak bodies, our aim has always been to get support where it is needed most—on the ground in local communities, where the real work is done.

We believe in local solutions for local problems and we believe in backing local initiative and drive. All of our programs—Landcare, Greencorps, Work for the Dole and the job training network—are about local approaches. We also believe that such an approach brings better value for taxpayers' dollars and more practical results. Dairy RAP funding has been about supporting local communities to deal with the effects of deregulation each in their unique, appropriate way. It was community driven. It really makes sense to take this approach. The way that best suits the dairy farmers in my electorate may not necessarily work in Tasmania, for instance.

I would like to take this opportunity to acknowledge and thank the area consultative committees around Australia for their hard work in helping the Howard government deliver practical assistance where it is most needed. They are our local eyes and ears and work closely with businesses and community organisations to really make a difference. In my own electorate I thank the past chairman, Brian Gassman, and the incoming chairman, Dennis Chant, as well as Annie Norton-Knight and the entire committee for their fine work over the years. When it comes to Dairy RAP funding, they have had some wonderful success stories in Forde.

As well as funding for ongoing counselling and financial advice to directly assist dairy farmers, there has been a wide range of funding support for other initiatives for our local rural businesses. There was $55,000 for the new crops options project in Boonah to help identify new crops that would have the greatest chance of success in the Boonah shire and to help provide advice to dairy farmers thinking of diversifying. Consequently a further $220,000 was provided to a local company to facilitate the processing of Ebisu squash for the Japanese market and provide local farmers with an opportunity to diversify their business.

Another announcement saw $220,000 for an eel nursery in the Beaudesert region to create a new industry. This has provided 18 new jobs and they are now an export manufacturer. There was a further $223,500 for the Plasvac expansion project, which assisted small companies specialising in veterinary plasma supplies to expand their laboratory, creating 17 new jobs and another new industry for our rural region. Then there was $55,000 for the Gold Coast hinterland wine country marketing plan to help promote and expand award winning local wineries at Tamborine Mountain. There was $44,797 to increase export opportunities for a local company called Ironbark Recyclers, specialising in fine furniture created from recycled timber in our rural area. Another round of Dairy RAP funding provided $750,000 to establish a game meat export plant in our rural town of Beaudesert, again to create new jobs and greatly increase export opportunities.

The list goes on. There was funding of $242,000 to Standfast Enterprises to help them manufacture their unique safety harness and to market it around the world. It has been very successful and two new factories have been built in our rural towns because of Standfast. There was $220,000 to help establish the world-class Beaudesert equestrian centre, which is now a reality and a tremendous facility that acts as a hub for the growing horse related industry in the shire of Beaudesert. Again, it is a new industry with new spin-off enterprises and a lot of new jobs for the community. This is what Dairy RAP funding has been about: creating jobs and helping local communities secure a better economic future in the wake of deregulation.

There have been many more examples in my own electorate over the last few years, but I do not have the time today to list them all. The thing to remember is that, on top of this new industry, there has been over $1.63 billion in direct payments to dairy farmers—a huge assistance package by any measure. Again, it reflects the government's commitment to rural and regional communities. That said, I do not want to play down the problems that many dairy farmers have faced. Some farm families that have been in the dairy industry for generations have left. That is sad for the industry and very distressing personally for those involved. While there is no denying that deregulation has brought great difficulties for some, it has also presented great opportunities and challenges for many. As I said, I see many inspiring stories in my own electorate of individuals taking on new ideas and of communities striving together to support their industries.

It is widely acknowledged that the Australian dairy industry will be much better off in the long term as a result of deregulation. History, of course, will be the best judge of that, but I believe that the Howard government has done everything possible to make sure the adjustment period has been as manageable as possible for farmers. Change is generally stressful, but we have worked hard to minimise the stress when deregulation inevitably came about. We did that because it is the right thing to do and because our farmers deserve our support.

I am glad to have had the opportunity to speak in support of this bill and to place on the public record my strong support for the dairy industry, especially the dairy producers in my electorate. I congratulate them for the way that they have handled themselves through some very difficult times. I have always been there to support them and I have made sure that the minister has come into my electorate to talk to them in person. This bill will ensure that Australian dairies can continue to effectively manage the Dairy Structural Adjustment Program in the interest of the industry. I commend the bill to the House and also congratulate the Minister for Agriculture, Fisheries and Forestry for his ongoing work in support of our farmers.