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Thursday, 21 June 2007
Page: 49


Senator ADAMS (12:01 PM) —I rise today to speak to the Wheat Marketing Amendment Bill 2007. I state first up that, as most people know, I am a Western Australian farmer and a wheat grower. I think it is very important that you know that. I do have a lot of practical experience within this realm. Western Australia is one of the largest wheat exporting states, as is South Australia. Therefore, I have had a very keen interest in this. Before I start talking about the bill and the amendments, I would like to thank the members and senators and all those who assisted me with my private member’s bill, which was withdrawn during the week. The reason I did that is that, through consultation and a lot of hard work on behalf of a number of people, most of the issues that I raised in that bill are able to be contained within the amendments in this bill. So I thank sincerely all those people who made it possible for me to support this bill.

At the moment, unfortunately, Western Australian farmers are going through somewhat of a drought. A lot of crops have not been planted. So, once again, it is going to be a very difficult year for Western Australian wheat growers. We will not be able to provide the amount of grain that we would have hoped to provide. There is a lot of angst in the farming community at present as they are very uncertain as to whether they are once again going to warehouse their grain or send it to AWB. As most people know, AWB will be controlling the 2007-08 harvest. There is a reason for this and I accept that reason, which I will explain later. But it is very difficult for those farmers. A number of them are owed a lot of money from the 2005-06 season. This is possibly one of the reasons why AWBI should manage the 2007-08 crop; hopefully, they will be able to sell the remainder of that grain and repay the farmers.

I will explain the grain seasons. The grain seasons do not end on 30 June each year. They carry over for a number of years because the grain that is stored may not be sold within the year that it is harvested. That is another reason why AWBI should be controlling the crop this year. I look for choice for our farmers, and this bill has a veto power which will be extended to the minister again this year, going through to 30 June 2008.

A number of farmers have contacted me, as you can imagine, asking why I withdrew my private member’s bill, why I have done this and why I have not done that. It is really hard. They are all saying, ‘We are not going through what we went through last year; we are going to warehouse our wheat and that is it.’ So there is a lot of uncertainty. I just want to put on the record that I am representing those interests in Western Australia in the best possible way that I can. I am very confident about the amendments. They are probably not all that I wanted, but we are making progress and we are going forward, and I think that is very important in this very difficult debate.

There has been criticism of the government for not consulting. I would like to go back a bit and say how the government set up the independent body, the Wheat Export Marketing Consultation Committee, to go out and consult growers right around Australia. They held 26 meetings. I congratulate those people on the committee: the chair, Mr John Ralph, Mr Roger Corbett, Mr Peter Corish and Mr Mike Carroll. They did an excellent job. I attended five of those meetings. The farmers had every opportunity to get up and say what they wanted to say. As has been said, a number of them wanted the single desk. It is quite amazing how things have changed since those consultation committee meetings and how much farmers, in Western Australia especially, are aware of what has really gone on with the single desk and how it did not serve them the way that they hoped it would. The government opened up that consultation phase by sending these four gentlemen out around Australia. It was a very arduous time for them; it took us a fair bit of time to keep up with two meetings every day, with probably 100 to 120 farmers, on average, attending every meeting.

The retention of the single desk was a major issue, but unfortunately a number of them had the AWB hymn sheet, from which we would have heard probably 30 or 40 times throughout the consultation process. But that was fine, and they had their say. When they were asked questions, a lot of them were rather horrified that they had to answer as to what they had said. But it did not matter. What has happened is that we have had a huge amount of community consultation right throughout, and the government had to come back with the Ralph report, which none of us has seen; it is a government document and there were not to be any recommendations. That report gave the government the opportunity to have a compilation of all the comments and all the remarks—everything that was said—so that they could work out where to go next.

I do not need to remind you that we are dealing here with a multibillion-dollar industry, and I know a lot of my colleagues are probably sick of this wheat debate and of hearing me talk about it, but it is very important. It is important to Australia and it is very important to my own state of Western Australia. The Australian government’s principal concern is the wellbeing of Australian wheat growers, including maximising returns to growers.

I would like to now go on to the bill and the amendments. Senator O’Brien, you possibly did not get the second reading speech which was tabled in the Senate. A number of amendments have been made by the House of Representatives, and when I have finished you might be a bit happier with what has happened with this bill. The first schedule relates to the information gathering and investigative powers which will commence on royal assent of the bill. This gives the Wheat Export Authority—as it is known at the moment but which later, with another amendment to the act, will be known as the Export Wheat Commission—broader information-gathering powers. It also provides the Minister for Agriculture, Fisheries and Forestry with the power to direct the Wheat Export Authority to undertake investigations that the minister considers to be in the public interest. This, to me, is a very important clause: the power to request information and documents, the power to request a report and the power of the minister to direct the investigations. It addresses problems the Wheat Export Authority has had in progressing possible breaches of the law under the current act, where it was restricted from sharing confidential information.

For too long growers have been kept in the dark on the operation of the industry in which they participate and on which their future is decided. I found this very obvious, because each time I went to an estimates committee hearing and questioned witnesses from the Wheat Export Authority they could not answer the questions because the legislation constrained them from doing so. So, in that schedule, things change a great deal for the Export Wheat Authority as it is now, and then for the newly formed Wheat Export Commission, which will come into being on 1 October. The reason for this is that the Wheat Export Authority’s financial reports go from 1 October to 30 September; therefore, when they put in their financial statements the new authority should be taking place.

Schedule 2 relates to the veto power. It is the extension of a temporary veto that was granted for six months to the minister in 2006, and it expires on 30 June 2007. This is one of the reasons it is very important that this legislation is passed today. The important item in this is the fact that the minister has a temporary veto power over non-AWB (International) Ltd bulk exports, but the power is due to sunset on 30 June 2007 and will be extended to 2008. That will prevent the veto going back to AWB for the 2007-08 harvest. I quote from the second reading speech, which says:

The Government has stated publicly that while the veto power resides in the hands of the Minister it will continue to be exercised in the public interest and in a way that treats any application for a consent on its merits.

I think that is a very important part of this bill.

I move on to schedule 3, the replacement of nominated company B. This amends the act to give the minister the power to designate a company as the holder of the single desk export privilege under the act. The government has given growers what they asked for. They have been given a chance to set up their own company to run a single desk. The deadline for growers to establish a new entity to manage the single desk is 1 March 2008, and it will not be extended. I now quote from the Prime Minister’s reply to a question from the member for Grey, Mr Wakelin, in the House on 22 May. The Prime Minister said:

If growers are not able to establish the new entity by 1 March next year, the government will propose other marketing arrangements for wheat exports. Let me make this clear to the House. The options available would include further deregulation of the wheat export market. The government believes that the new arrangements will maximise the returns to growers …

This is what this debate is all about. It is just so important that growers are the important people at the end of this activity.

The power of the minister to designate the new entity to assume the rights and powers of single desk management, which, I repeat, commences on 1 March 2008, has a sunset date of 30 June 2008. This was open-ended. It now has a sunset clause—that is, four months—and gives the minister the opportunity to designate the new company with the powers that it should have. If it fails to do that, this is one new company. It is not another company; he cannot do that. It is a company that is being formed by the growers—only that company. That is the understanding we have with this bill, and it is very important. Further to that, if the minister does not designate this new entity in the period 1 March to 30 June 2008, the veto power will not revert to AWBI, which is very important. This effectively removes any possibility that the bulk veto power could revert to AWBI once the minister’s temporary veto powers sunset after 30 June 2008.

To clarify what I have said I turn to the second reading speech which was tabled with the bill today, which said:

Naturally, before the Minister designates a new entity to take over as the operator of the single desk it will have to demonstrate that it is financially viable and has the capacity to undertake the task. The single desk privilege will not be granted to just any entity.

The fourth schedule is about the non-bulk export of wheat, which relates to the deregulation of containers and bags and the introduction of a quality assurance scheme. As you have heard, bag and container exports make up only a small proportion of wheat exports from Australia—roughly between three and five per cent. They are attractive to growers, however, because of their higher return than the bulk export market. Growers who wish to export their wheat in bags and containers will not have to apply to the Export Wheat Authority and the wheat commission; however, they will be required to comply with the conditions of a quality assurance scheme which will be developed by the Export Wheat Commission.

The quality assurance scheme is needed to ensure exporters are delivering what they promised they would and protect the good reputation of the wheat. This is another new amendment. The deregulation of exports in bags and containers and the QA scheme will come into effect 60 days from the royal assent of this bill, and penalties will apply for noncompliance with the QA scheme. It is important to note that at the moment the National Agricultural Commodities Marketing Association, NACMA, have that scheme in place and that is what is used by the Wheat Export Authority at the present time. This is also a very robust process and is well supported by the Wheat Export Authority and AQIS. We do not have a problem with that, because it is already there. That measure comes into effect in 60 days after the royal assent.

We move on then to schedule 5, which will cover the change to the governance arrangements to the Wheat Export Authority. This new commission—it will be renamed the Export Wheat Commission—will come under the Financial Management and Accountability Act 1997, which is very important as well. The new commission will be a skills based commission of between four and six members. All members will be appointed by the minister. At least one but no more than two members of the Export Wheat Commission must have substantial experience in grain production and be known to the industry. And one but no more than two members must have experience or knowledge of export wheat marketing and be known to the industry. This is very important. It also ensures that the Export Wheat Commission has a strong understanding of the industry and that growers’ interests will be well represented by the commission. The Export Wheat Commission will consult regularly with the industry on important operational matters. Then we move to transitional provisions, which cover changing from the Wheat Export Authority to the Export Wheat Commission.

To summarise, the key elements of bill include: the extension of the Minister for Agriculture, Fisheries and Forestry’s temporary veto power over non-AWB (International) Ltd bulk exports until 30 June 2008; the inclusion of the power for the minister to change the entity that operates the single desk to operate from 1 March 2008 until 30 June 2008; improved powers for the regulator to obtain information particularly from wheat exporters other than AWB International; the inclusion of the power for the minister to direct the regulator to investigate matters relating to its functions and pass this information on to other law enforcement and regulatory bodies as necessary; a range of structural and governance reforms to the Wheat Export Authority in line with the principles advocated by the Uhrig review; and the deregulation of wheat exports in bags and containers but with the addition of a quality assurance requirement to safeguard the reputation of Australian wheat.

In conclusion, I think that the wheat-marketing arrangements have had a long history and they have evolved over many years to meet the challenges facing growers. This bill clearly explains where we go from here and the fact that the veto power will never return to AWBI. It is very important. Once again, I would like to hope that we are moving forward. I have said that we are making progress with this and I therefore support the bill.