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Rural and Regional Affairs and Transport References Committee
04/08/2015
Effect of market consolidation on the red-meat-marketing sector

MOORE, Mr Robert William, Private capacity

[11:49]

CHAIR: Welcome. We have received your submission as submission No. 71. Are there any amendments or additions you wish to make to it?

Mr Moore : There are. I will just read the cover note. I have put it in there. Senators, please find an Independent Cattlemen, United States, newsletter which sums up the situation with the same global processes in the frame here. It is written in the US. One and two are there; one and two are here. So it is totally relevant to the problems here. That is tabled. I have copied the Livestock Transaction Levy Act. In 2011, with Senator Ludwig, in a private effort I did a lot of research into the MLA and the levies collection unit and the whole church-plate system of how the MLA is funded. It is absolutely terrifying. I would bet that nobody in this room would have a clue about what I found out. Anyhow, I was ignored, I was laughed out of the room and nobody cared because the people I was talking to were all doing very nicely out of it.

I believe that it absolutely undermines the whole pillar of what the Meat Industry Act was written for. It is at the fundamental base of all the trouble here. When Senator Ludwig left I had proved it to a point and Beef Central wrote it up a bit. You get to a certain point and then you die. They know that I am a busy man and that I have to run a business, and I could not afford to fund a verdict from the Australian Government Solicitor. Here we are and fate has intervened. I was very jaundiced about what was going to come out of this. I did not think much would, but there is my action here. I have a copy for every senator. I have written to the ag minister. I will just finish the cover note because I have explained it.

CHAIR: I am going to ask you to make a brief opening statement, but we will chuck it all into one—

Mr Moore : Well, this is it.

CHAIR: I have not asked you, but chuck it all into one and then we can get to questions, Mr Moore.

Mr Moore : There was the Livestock Transaction Levy Act. The 2011 month-by-month figures from the LRS are an absolute ticking time bomb. I got those by pestering the LRS people in Canberra, which is just a little backroom office. Everybody is wondering how a processor can have the vote controlling block on the producer companies. One hundred and seventy million dollars goes into the MLA. Half of it is our levies and half of it is taxpayers' money. In 2011, I did a whole snapshot: the research; the month-by-month figures. I maintain that the only way a processor could have any voting rights is by their own feedlots to their own works, which is not a transaction. It is a related company, obviously. That brings it back to the act. To win the argument, we have to have the Government Solicitor tell me on behalf of everyone. I could be wrong, but I do not think so. This goes to the heart of whether the processors have had the final say over our levy for the last 18 years. That explains everything about why we have been led over the cliff at every point. This is a little bit of a tangent. I agree with everything people here have said. It does not need repeating, but you get the same old story and you are looking for solutions.

Mr Joyce chose to turf out all of the seven recommendations. No. 7 was mine—the Packers and Stockers Act. I went to the MLA. I am jumping all over the place. David Warriner just got a bit of a mouthful there. He did not even put a submission in. He happens to be doing the tender that I instigated—and I can prove all this—which is just a little snapshot of the MLA working against producers and producing meaningless rubbish. Anybody in the room knows off the top of their head the cut-outs of profits. Blair Angus said it is three to one. You just need a ratio; you do not need to know how hard you are being screwed. It varies every day. The fact is that we have all been robbed. Yes, Barnaby Joyce will say, 'The price has gone up. What's wrong with you?' He has been well paid for the last three years. We have all done it bloody hard.

I have notified the secretary of the Department of Agriculture, the agriculture minister and the managing director of MLA of my research. I would ask you to pursue the answers from the Australian Government Solicitor on behalf of me and all producers. I have highlighted in yellow the relevant sections and need an explanation for the owners of the 528,577 grain-fed non-levy cattle that were reported in 2011. People can say I am a nutter. You have to have evidence, like Barry knows. I got this document by accident. They are listed. That is what you are getting. That is what I have tabled. Without putting the genie back in the bottle, I want the answer to where those cattle came from. In there is a form that people submit and there is a little column in there that says, 'Non-levies must be accompanied by a levies exemption form,' so it would be very easy to find out who owns the 528,000 cattle. This was in 2011.

CHAIR: Sorry, Mr Moore, can I just interrupt there? I am listening intently. This committee just completed another levies enquiry and it is an absolute shock that no-one knows who the hell the levy payers are. This is how bad it is; this is how shocking it is.

Senator O'SULLIVAN: Someone knows, but there is a privacy issue.

CHAIR: Senator O'Sullivan, a lot of them could not tell us who the levy payers were.

Mr Moore : When you see this form and what I have submitted here, you will understand exactly. You are going on somebody's submission. I am here. I do not have any faith that next year this will be written up. We have to survive between now and then and wait.

Senator WILLIAMS: Mr Moore, can you get to the point of this form, please? Let's hear about it.

Mr Moore : I do not want to waste half an hour on that. That is plain. I have lodged it in a whistleblower capacity, so, irrespective of this, I am going to get an answer. By giving you each a copy, I expect you to take it up with Mr Quinlivan in the department. They have to deal with it. I have put evidence in and it goes to the heart of what we are here for. That is what I am tabling.

Senator WILLIAMS: Hang on, I am getting totally confused here. You have got this document as a whistleblower and you want us to take it where?

Senator CANAVAN: The new secretary of the Department of Agriculture.

Senator WILLIAMS: Okay.

Mr Moore : This is a three-cornered circus. There is the political process, which led to what I did last year going nowhere; Sir Humphry, which is the Department of Agriculture; and us. It just gets passed around. My action here is to make sure that this one does not get passed around, because when that ruling comes it could just pull the whole rug out of the MLA. I do not believe that I should have to pay a single levy to them until I get the answer, because, if it is a church plate, I will keep my $5 a head.

Senator O'SULLIVAN: Can I ask an intervening question here. Mr Moore, today there is a store sale out here. We drove past the cattle coming in yesterday. There will be hundreds, if not thousands, of transactions there today. At the point of that transaction the name of the seller is known, the application of the levy is known to that transaction, the pick number of the seller and the buyer are known, and that data is collated and submitted because that money is appropriated. It is not $5 of simple form; it is four separate levies that add up. That is appropriated. That is effectively a tax and the money becomes the ownership of the Commonwealth. Then from the Commonwealth, via the MOU, it goes into the MLA. So, if you want to look for the data about who has paid a levy, what it was, what the transaction—

Member of the audience interjecting—

Senator O'SULLIVAN: No, it is out here today.

M ember of the audience interjecting

Senator O'SULLIVAN: I know you cannot get it. I am telling you that the data exists. There is a privacy issue with this. I am hearing: 'No-one's got the data. We can't get it.' You can get it. You could go out to the sale yards if you had the power to. It is there today.

Mr Moore : There are 20 people in Canberra in this office—this is four years ago. Have you seen the form? Obviously, you have not, because there are bobby calves, grain-fed and grass-fed, with levies paid, non-levies paid. There are six categories. Everything finishes up on the form. There are those 528,000 grain-fed, non-levied. I have to think really hard, after 40 years, where they could have come from. Nobody can tell me. ALFA cannot tell me. It is all there. I have done the whole 10 yards on it. It just goes dead.

CHAIR: We just need to clarify this.

Senator BULLOCK: You say you expect senators to act on what you have put to us today, and I have to tell you now that I cannot, because I have found your presentation utterly incoherent. So do not expect anything from me.

CHAIR: We have had two inquiries: one into levies—you are well aware of the grass-fed levy—but we have also had a genuine levies inquiry. But to come back to the grass-fed one, you are asking us to ask questions to the department. Just so I am very clear, the department, in evidence to this committee, has no idea of who all the levy payers are. That is the evidence we took. It is not a privacy issue; they do not know. Without leading you down the false path, Mr Moore, it would be no good for us to go to Quinlivan, the new secretary.

Senator CANAVAN: Someone would know.

CHAIR: Someone might know, but Mr Moore is asking of us to take this. Just so we do not lead him into a false belief—

Senator CANAVAN: I am not formally a member of this committee, although I was at Senate estimates last time. Mr Moore, you might be able to help, but my understanding is the MLA and, I presume, in conjunction with the Department of Agriculture, are currently spending what did seem an inordinate amount of money trying to get to the bottom of this and discover who is paying a levy and have a proper register such that people can be alerted at annual general meetings and those things. Obviously, there are privacy issues with all of these things. Is that happening?

CHAIR: I can help you, Senator Canavan. One of our recommendations from the grass-fed inquiry was to establish a database, which has not even been accepted by the minister. This is the frustration.

Senator CANAVAN: That is not my understanding, Chair.

CHAIR: We are not going to get into it here, because I hope I am wrong. I really hope I am wrong.

Senator CANAVAN: Okay. As I say, I am not a member of this committee who always follows issues, but it is certainly not my understanding. But it says here: 'Government agrees with the recommendation, currently working with red meat, horticulture and grains industries in a pilot project.' It might not be happening as fast as you would like, Senator Sterle, but I believe they are accepting the recommendation.

CHAIR: I apologise, that was one that he picked up. Banging your head against a brick wall starts to bloody hurt after a while. I have only been doing this for 10 years; you poor buggers have been doing it for four generations.

Mr Moore : I have been a one-man band in a lot of stuff that I have done. For example, Richard Norton has belatedly got his team to look into how we can do it. I have an email from Richard Norton telling me he has not got the authority to do it.

Senator CANAVAN: No, he would not.

Mr Moore : That is what he told me, but then he is doing it.

Senator CANAVAN: Sorry, I agree with you. He would not on his own, no way.

Mr Moore : But he has changed his mind. I am actually at the forefront, causing a lot of this stuff. I can tell you all for nothing, it is not about me and my little—David Warriner did not put a submission in and yet he is talking here. I rang him last year about getting feasibility and modelling for what is the main issue—not about you supporting my thing. I will do that on my own. I should not have asked that, but I just thought it might have been a reasonable request to put a bit of pressure on the Department of Agriculture. I lodged this whistleblower stuff with them and I had to ring in seven days, running to the PA of Mr Glyde, who is No. 2, to get a receipt of the email I sent there. They are in that much denial that they cannot touch it. This has been on the record for months and months and months. It will give you an indication of what it takes to get reform here. I spent two years at this. A year ago I drove 700 kays to Rockhampton, and a few weeks ago I find that they have thrown the whole seven recommendations out and I am meant to line up here again.

Senator O'SULLIVAN: No, that is not correct. Mr Moore, your evidence is flawed on a number of levels. Firstly, the chair has advised you that you can ask the Department of Agriculture for this data until you are purple in the face and they do not have it to give you. That has been established at estimates. Those seven recommendations were not thrown out and, in fact, one of them is consistent with what you want. So you cannot just continue to give evidence based on these reference points that are not accurate. It is just not fair to do that.

Mr Moore : Yes, but recommendation 7, which was the Packers and Stockyards Act—

Senator O'SULLIVAN: We are not talking about that at the moment. You are talking about the pursuit of data in relation to transaction levies. If you want to move on to that, let us move on to that.

Mr Moore : Yes, good.

Senator CANAVAN: I am not sure if there is still an opening statement, but I do have some detailed questions on the Packers and Stockyards Act. Perhaps I could go to that.

CHAIR: Senator Canavan, yes, otherwise we will start running out of time.

Senator CANAVAN: I have looked through the Packers and Stockyards Act, Mr Moore, and I give you credit for your passion in this area and for bringing it forward. I am interested in specifically what parts of that act you think could translate well to our environment. I am particularly interested in how it would fit in with our more generic competition law, because some aspects of the US act would seem to already exist in our Competition and Consumer Act, albeit more generically and not just in relation to the packers and stockyards industry. I am really interested in what specific elements you think would add value to the existing competition policy and law we have in Australia.

Mr Moore : I might seem a bit proper here. You see, 2013 was an awful year and by September 2013 I thought, 'Right, what do we need for self-help reform?'—he same as we are talking about here—'The Packers and Stockyards Act is giving the American cattlemen 2½ times what I'm getting, so let's have a look at it.' I googled it—I was injured; I had a month off—and straight away when you look at it you realise that the first thing is the antitrust laws would say that JBS and Teys have to sell their feedlots. We saw what happened the other day with Primo, so what government is going to do that?

Senator CANAVAN: I have not read every word, I must admit, of the Packers and Stockyards Act. I cannot see, though, in that act where a packer, in the US definitions or terms, would be prohibited from owning a stockyard or a feedlot. Is there a separate act?

Mr Moore : It is GIPSA. In 1921 they had their Packers and Stockyards Act. It was the same cartel in 1921 that we have here today.

Senator CANAVAN: I am just asking specifically whether there is a prohibition on ownership from a—

Mr Moore : Yes, it is called captive supply. The competition is what we are all missing here and how we get it is the solution. That is what I am saying. Two years ago I came up with this packers and stockyards equivalent, which I christened the Primary Production Pricing Bill, and I was silly enough to think it would be good for horticulture, dairy or anything—ping-pong balls. Just put competition into a market.

Senator CANAVAN: I am saying that a lot of the generic provisions here in section 202 of the Packers and Stockyards Act on unlawful practices go to deceptive behaviour and unfair, unjust and discriminatory practices. While the same terms are not always used in our Competition and Consumer Act, the concepts are certainly reflected. So what I am trying to establish is could we not simply achieve the desired result, which is more competition, via better and more stringent enforcement of our own competition laws that we have? Because we can write as many laws as we like, but if they are not enforced they are not going to have any impact anyway.

Mr Moore : I agree with you. For example, with the JBS Primo takeover last year there was glaring evidence that the political side of things is just a rubber stamp. And, believe me, they are not allowed to own feedlots there. It is antitrust; it is captive supply, and that is a fundamental reason they got twice the price. It is not perfect. When I googled it I saw straightaway that they have a small army from USDA retrieving information. It is like putting the genie back in the bottle. David Warriner is finding out—he has virtually taken my idea and got on the bloody trough, but I have been putting pressure on him—and he told me that the JBSs are not forthcoming. Why would they be? An MLA tender asking them to open their books—he has got no authority. This is what we are up against. This is hardball with the biggest companies in the world. I spent three hours with Brent Eastwood, the top man in Australia. He is a thoroughly decent bloke.

Senator CANAVAN: What I am trying to get to, Mr Moore, is that I would be very surprised if we could take the Packers and Stockyards Act almost as written, or with very few amendments and translating it; it probably would not work. It is something that could maybe be used as a basis. While I was not in the Senate for the previous inquiry, my understanding was that the recommendation was for the government to consider something like this act. My question is: what sorts of differences and adjustments do we need to make to what is in America to fit our market and deliver a result in Australia?

Mr Moore : My answer to you is: what more can I do? I have put it in writing four times now. If you people cannot read it—

Senator O'SULLIVAN: Rob, the question is a very, very simple question. Using what you put in writing, to whoever you have written to, as your reference point—

Mr Moore : No; I put it in a submission.

Senator O'SULLIVAN: Hold on, let me finish. Using what you have put in writing as your reference point to refresh your memory, you can answer his question. He is asking you: what are the elements in the Packers and Stockyards Act that you think would be beneficial in Australia and that are not currently covered in our legislation? It is pretty simple.

Mr Moore : A simple trade practice rule would be the only government intervention would be an online offer board—just think options-plus. But I am only interested in the funnel from the farm gate to the processing sector. That is where all the trouble starts; that is where our prices are set for our studs and store stock. Get that right and everything follows. All I want is competition there. There would be less than 100 companies that it would apply to. Call it what you like. It is my idea and I have got to try and sell it to people. People will not read. Barnaby Joyce will not read it. He would not know to this day. I have sent it all to every single one of you people.

Senator CANAVAN: I have, and I might not have read all your correspondence, Mr Moore—

Mr Moore : Well, you have missed the punchline with that last question!

CHAIR: Order!

Senator CANAVAN: I have read some of it and I have certainly read the legislation you referred to, or read it in context. In terms of establishing this mandatory reporting, or the disclosure of a live grid, my reading of the US legislation is that it is actually not covered in the Packers and Stockyards Act. It is the Livestock Mandatory Reporting Act, a separate and more recent act, which covers packers and establishes mandatory disclosure. My reading of that, though, is that it is disclosure of the prices paid, not the offers made. Sometimes, in correspondence that I have received from you, you are talking about a mandatory disclosure of offers. I have a little bit of difficulty with that. When it is an offer, not actually a contract, should they be mandatorily required to disclose that? Or are you just calling for disclosure of what was actually done on the transaction and agreed to?

Mr Moore : You are spot-on. It has got to be mandatory. As I said, you study it. You have got 10 times the population; you have got a huge amount of red tape with the USDA to retrieve the stuff back. If you are going to sell something, you have not got a hope in hell of more red tape—we all know that—whereas the online offer board, as you say, was purely my idea, and there is no precedent for it. But does that mean that we just go down, down, down without even looking at it? That was my whole thing. A year ago I went to Cloncurry and Rob Atkinson said, 'This looks like something that the MLA should fund'—feasibility and modelling. Obviously, that was my next step. If you have got an idea, you have to go and write it up and sell it to people. It will be expected. So what happened is that I applied with another fellow, exactly like Warriner with his team. We put a quote in there in May. I have got major issues with that process. A lot of people think I have sour grapes because I did not get it. But I can prove that it was solely my idea and all my work that started it. And I have got letters to prove that. Then it went on and on, but the net result is that, unless we all cut to the chase, I could be here in five years' time and we will be talking about the same thing.

The government side of things, the public service side and the legal side, as you said, are about precedence. We are that far down in the power game now. It is like a game of monopoly, with the processors owning all the green and the red, with hotels on them.

Senator WILLIAMS: That is why I launched the inquiry.

Mr Moore : I am all for it, and I am thankful for being here—and well done. But what I am trying to say—

Senator WILLIAMS: You said earlier that recommendation 7 of the levies inquiry was rejected by the government. Is that correct?

Mr Moore : I just read the—

Senator WILLIAMS: Is that correct? Is that what you said?

Mr Moore : Yes.

Senator WILLIAMS: Let me read to you the government's response:

… an analysis of the benefits, costs and consequences of introducing legislation akin to the Packers and Stockyards Act 1921 and Livestock Mandatory Price Reporting Act 1999.

Point 1: the government 'agrees in principle with this recommendation'. Point 2: assessment by Meat & Livestock Australia 'will assist in identifying the benefits and costs of addressing deficiencies in price transparency'. Point 3: 'The Agricultural Competitiveness White Paper has committed $11.4 million over four years to boost ACCC engagement with the agricultural sector to strengthen competition through fair trading investigations and enforcement actions.' Point 5: more resources out in the field. Point 6: 'the appointment of a commissioner with specific responsibility for agriculture'. Point 7: 'A further $13.8 billion has been committed for a two-year pilot program to provide farmers with knowledge and materials on cooperatives, collective bargaining and innovative business models.' That is the response from the government. I say to what you have said earlier on about recommendation 7 that the government rejects it as false and misleading evidence. I just want to put that on the record.

CHAIR: Mr Moore, I will give you the opportunity to respond, should you want to, and then I am going to have to wrap up and move on. Do you have anything else to add?

Mr Moore : Is my half hour up?

CHAIR: Yes.

Mr Moore : Okay, well that went well, didn't it. I'll get back to my notes.

CHAIR: Just a quick wrap-up, because we have gone over time. But I am giving you this opportunity.

Mr Moore : We were half an hour behind when I started, but, anyhow. Submission 1, a hand-written submission, was from Tom Hunt, a fellow who supplies cattle through a processor. He had absolute evidence, which the ACCC should be dealing with. I feel that they should have a representative here. I have taken a big risk. I have not even addressed my submission, but you are talking about secret tomes. I have it written down. My name is at the top and I have named processors and that. What more can you want. I am living proof of it. Two years ago I had to make that decision—you cannot be half pregnant—and it is not much fun, believe me.

CHAIR: On that, just so that you do not feel hard done by, there were four witnesses sharing the table earlier and we are desperately trying to balance the representation and the time given.

Mr Moore : I have put two years in—

CHAIR: Thank you. I understand that and we appreciate your having made the effort. I am going to have to wrap it up and call our next witness.