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Wednesday, 31 August 1994
Page: 642

Senator SHERRY (Parliamentary Secretary to the Minister for Primary Industries and Energy) (11.34 a.m.) —These bills deal with amendments to three acts that relate to the levy system that we have for funding both the Australian Horticultural Corporation and the various R&D corporations in the horticultural industry sector.

  The debate has been broader than the specific references pertaining to this legislation, and I do not criticise that. I think there are a number of significant issues related to the horticultural industry that have been drawn to the Senate's attention, particularly by Senator Panizza, Senator Bell and Senator Boswell. I will comment on and summarise a number of those issues that other senators have dealt with in a very constructive way. They include issues such as the citrus industry, and the immediate concerns facing that industry; our dumping laws; and GATT and its ramifications for Australia and the horticultural and general agricultural sectors.

  Firstly, this legislation has come to the government and into the Senate at the request of the industries concerned. I think it is important to emphasise that. It is not the government that is saying that we should impose a new form of collection points for the levies; it is the industry that has come to government and said, `Look, it is not practical, given the current levy mechanisms, to collect levies in our industries because of the method of collection.' The gut of the government legislation is to provide for varied forms of collection of the levies, such as the number of trees, shrubs, plants, bulbs, corms or tubers under cultivation, and to use the presumed yield in these areas to calculate levies in those industries that request the government to apply the levy.

  I have had a number of meetings in the past 18 months with the two industries concerned, the nashi industry and the strawberry industry, in my capacity as Parliamentary Secretary to the Minister for Primary Industries and Energy with some specific responsibilities in the horticultural sector. These two industries have

said to the government, `We would like as an industry to consider a levy system. However, we don't believe the current levy mechanisms are practical for our industries, so we would like alternatives to be available should we come to the government to request levies to be made.'

  This legislation has the support of all the parties in the Senate, and I thank the parties for that support. I have already mentioned that it is industry that is requesting that the levy mechanisms be varied. But there is another step in this process. The industries themselves then have to decide whether they want a levy collected. Certainly, the two industries that have sought amendments to the way in which levies are collected, the nashi industry and the strawberry industry, have been discussing the collection of levies for some time.

  I would like to emphasise to the Senate that again it is not government that comes to the nashi industry, the strawberry industry or, for that matter, other industries that are levied, either for the Australian Horticultural Corporation or the various R&D corporations. It is those industries, having been involved in a very lengthy consultative process with their constituent organisations, who say to the government, `We would like to be levied in these two particular areas.' I suppose one of the difficulties we have is that it is, in my experience, almost impossible to get 100 per cent unanimous support for a levy system. But the government policy in this area is very clear. It does require a significant majority of the industry to approach the government to seek a levy.

  I am pleased to say that this requirement for a significant majority in respect of the levy system we have for the AHC and R&D corporations has bipartisan political support. However, as I have said, on occasions it is very difficult to get 100 per cent support. For a variety of reasons, some segments of industries in respect of which levies are currently being collected, or it is proposed that levies be collected, do not want levies collected. It can get quite complex as to why they do not want levies collected. I have found from experience that there is less controversy about the R&D levy than there is about the levy to the Australian Horticultural Corporation.

  In the R&D area, the federal government provides dollar for dollar matching funding. So, where an industry voluntarily requests a levy, the government will match that with dollar for dollar funding. There has been some criticism of late—we believe it is incorrect criticism—that the federal government has not been committed enough to research in the agricultural sector. That criticism has particularly focused on the CSIRO.

Senator Panizza —Yes, with good reason.

Senator SHERRY —We have debated that before. I just want to highlight the significant contribution and commitment that this government has made through the R&D levy system. If an industry says it will help itself through a levy mechanism, this government, which initiated this provision, will provide dollar for dollar matching funding. Certainly, during the time that I have spent with the horticultural industry—it has been a lot of time in the last 18 months—I have found it to be very appreciative and very supportive of this system. In relation to the levels of funding in the agricultural sector as a whole—without going into the argument about whether the CSIRO gets enough money, the corporations get enough money or state governments are providing enough money—generally the federal government commitment to R&D has increased significantly over the last 10 years.

  In relation to the AHC, the government takes the view that it is necessary to have a national horticultural corporation to provide a national focus for what is a very dispersed and, generally speaking in terms of the representation of horticulture, not a particularly well-organised industry, with some few exceptions. There are over 100 different horticultural commodities. Very few of the horticultural commodities have their own national organisations to speak for them nationally. Very few of them have the resources to support the very necessary commitment that is needed to represent the horticultural sector, particularly in the international arena and particularly when it comes to a variety of issues such as quarantine access to a number of our markets or potential markets. The AHC plays a very important role in these access discussions, together with the Department of Foreign Affairs and Trade, Austrade, grower organisations themselves and the various ministerial representations that are made. Obviously, my minister, Senator Collins, participates in that as well.

  In an industry sector where the industries are widely scattered, have not had a significant export focus—with a few exceptions—and are not particularly well organised, there is a need for an Australian horticultural corporation. I stress again that the levies are collected at the request of the industries which participate in the Australian Horticultural Corporation.

  Again, I say that it is not possible generally to get unanimous support. However, the government has taken the view that where there is a significant majority it will accede to the request of a particular industry to levy it for the Horticultural Corporation. As we had in the research area, although not in the same way, the Commonwealth makes a direct grant of moneys to the Australian Horticultural Corporation to assist it to carry out its responsibilities. So, whilst it is not dollar for dollar matching in funding, it is a significant commitment of millions of dollars to assist the Australian Horticultural Corporation in its responsibilities.

  The Horticultural Corporation does not have responsibilities in just the international arena. It also has responsibilities, for example, in respect of the citrus industry in domestic promotion. That is particularly important.

Senator Boswell —Hear, hear!

Senator SHERRY —I am glad that Senator Boswell acknowledges that. It is particularly important that these activities occur where industry requires them. It is particularly important to have generic promotion. The Horticultural Corporation provides very important assistance to industry in these areas.

  Let me take up a point that was made by Senator Boswell. Where we are faced with the imports of not just horticultural commodities but other forms of agricultural commodities—I may touch on the dumping laws a little later—it is particularly important that we have active promotion of Australian products within the Australian market to highlight what I think is certainly their superior quality. For example, the citrus industry offers superior quality in terms of presentation, colour, flavour and, generally, growing methods. It is very important that Australian consumers are aware that there is a choice between an Australian product and an imported product. It is very important that the Australian Horticultural Corporation is involved in this area.

  The levy system is not without controversy. As I said earlier, it is not possible to get 100 per cent support. This brings me to the criticisms that were made by Senator Panizza and, I think, Senator Margetts that there is a view in some sectors of the horticultural industries in Western Australia that, for example, their local regional interests are not taken into account sufficiently within the national levy system that currently operates both for the AHC and the various R&D organisations.

  That is not a view that is accepted by this government. We believe that it is very important to have a national perspective. We also believe that a national perspective must be projected both into the international arena and the domestic market and that, where appropriate, that national perspective can accommodate regional diversity. It is unfortunate at times that some regions within Australia believe that, if levies were collected locally or returned to them locally, they could carry out all of these tasks by themselves. The government does not believe that is possible. We do not believe it is possible for smaller regional organisations to project themselves, particularly in the international arena, without the very significant support of a national organisation.

Senator Panizza —Sumich does very well.

Senator SHERRY —I agree with Senator Panizza that Sumich has done very well. I have been to Jack Sumich's property. In fact, he was a member of the Australian Horticultural Corporation and is very supportive of the corporation's general approach in this area.

  It is simply not possible financially, particularly for regional organisations, even if the levy were returned to them, to go out into the world market by themselves and carry out, for example, the necessary quarantine negotiations. Governments internationally do not recognise regional bodies. When it comes to quarantine issues, national organisations have responsibility for market access. I have pointed this out to the citrus industry and particularly to the apple industry in Western Australia and in my home state of Tasmania.

  The Horticultural Corporation has an active role to play in this area. Senator Boswell raised the fact—I think it is quite critical—that the GATT negotiations and the phyto-sanitary outcome, on balance, provide significant advantages for Australia. I see Senator Boswell nodding; he referred to GATT earlier. There may be one or two senators here who disagree with the GATT outcome, but—

Senator Margetts —Me!

Senator SHERRY —Yes, there is one. I thought there might be. But the GATT outcome does provide us with—

Senator Boswell —Name her!

Senator SHERRY —I am glad Senator Margetts is on the record. The GATT outcome provides us with very significant advantages in the phyto-sanitary area. It is not an issue that has been widely discussed or recognised. It provides for the scientific assessment of phyto-sanitary conditions in the export area. This is definitely to Australia's advantage—

Senator Margetts —Except if you are a banana grower in Queensland.

Senator SHERRY —I will get to the banana growing industry in a moment. I have spent some time with the banana growers as well. I think we now understand what our respective positions are but I do not think I will have time to speak on them.

  I was talking about phyto-sanitary conditions and the need for scientific assessment. That is overwhelmingly to Australia's advantage. For example, if the citrus industry is to survive in the long term, it is recognised that it needs to move away from a heavy reliance on juice towards a greater whole fruit export component. One of the critical areas to address is access into many of the Asian markets—for example, Korea—where, frankly, phyto-sanitary conditions have been used as a barrier to trade. It is the scientific assessment of these provisions under GATT that will be of vital advantage to Australia in obtaining market access to a whole range of areas, not just for citrus.

  But as Senator Boswell has acknowledged—I think quite rightly—that that will mean that Australia will have to be vigilant in this dumping area because it is increasingly possible for other countries to export their commodities to Australia for a variety of reasons. It is not possible with the banana industry—with good reason. We have to be vigilant about the spread of such diseases as black sigatoka. I think it will be a long time before that particular problem can be overcome and we will see the importing of bananas into Australia. One of our effective weapons is vigilance with our anti-dumping laws. Senator Boswell, I think very effectively, has dealt with the issues needed to be dealt with there.

  I conclude by thanking honourable senators for their contributions. The citrus industry package, particularly the sales tax issue, will be going to cabinet shortly. The minister is formulating a package that will go to cabinet in the next couple of weeks so there should be an announcement on the matter because it has been raised in this debate. It is certainly of critical relevance to the growers and exporters. In fact, I had a meeting with the grower representatives on Monday of this week, so I am particularly aware of the issues that need to be addressed there.

  Question resolved in the affirmative.

  Bills read a second time.

  The bills.