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Thursday, 27 November 2014
Page: 9607

Senator McKENZIE (Victoria) (18:12): I rise tonight to speak on the report from the Senate Select Committee on Australia's Food Processing Sector, for which the government's response was handed down this week. As a representative of rural and regional Australia, it was a pleasure to work on this select committee with Senator Colbeck, Senator Xenophon, and others, where we travelled around Australia getting data, while in opposition, on the food processing sector right across Australia, but particularly, I think, for my home state of Victoria—the food processing capital of the nation.

I welcome this government's response to promote the food processing sector. The report was tabled in 2012, with 35 recommendations, which the coalition, in opposition, found to be crucial to reducing the costs and red tape, to stimulating investment in the food processing sector, and to dealing with some of the issues that the sector as a whole had identified—food labelling laws, education and skill sets, research, competition law et cetera, and indeed the impact of the carbon tax on this particular sector.

It is 12 months since we have came into government, and of the 35 recommendations of this report the government has noted all 35 of them. Importantly, we are a government of action and we have actually started dealing with many of these recommendations. We are not only dealing with them but putting them into action. I want to speak about that a little bit tonight.

In my home state of Victoria, the food processing sector is critical to our economy. It has turned over $25.4 billion and employs more than 133,000 people across the value chain. We export to over 100 countries worldwide. Employment in the food product manufacturing sector has defied the general decline in manufacturing employment in Australia. Whilst employment in manufacturing as a whole has decreased by 7.7 per cent over the five years to August 2014, employment in food product manufacturing has increased by 3.1 per cent, and Victoria accounts for 24 per cent of the gross value of the Australian food and beverage industry. It is because this sector is important that we have been proactive in introducing reforms and fulfilling the recommendations that were put forward.

I echo the comments in the government's response to this report that the Australian government has commenced implementing a number of election commitments to boost business competitiveness, as well as to assist the food processing industry. As I mentioned earlier, getting rid of the carbon tax was this government's pre-eminent response to assisting the food processing industry to remain competitive and to be able to grow, particularly when you think that the majority of workers in the food processing industry are actually working in rural and regional Australia, underpinning the local economies of our towns and regional cities.

I think this is incredibly important, when you look at what Gary Dawson, CEO of the Australian Food and Grocery Council, stated about the carbon tax:

"One of the things we found with the impact of the carbon tax was that because food processing is such a trade-exposed sector, processing companies had very little or no capacity to pass through those increased costs to the retailer and therefore to the consumer," he said.

"So it went straight to the bottom line of the company and had a direct impact on the viability and profitability of the company.

Do you know what that means? That means less money for people to employ people. It means less jobs in regional Australia. That was the outcome of those opposite's grand carbon tax plan.

The second thing that we dealt with within the food processing inquiry was competition policy, and we made recommendations around recommendation 4. The committee recommended that the government initiate an independent review on the competition provisions of the Competition and Consumer Act, recommending that we should take into particular consideration the misuse of market power, creeping acquisitions, predatory pricing and unconscionable conduct.

We also went on to look at the role of an ombudsman in managing the relationships that exist within the food processing supply chain, and these are key to our government's response. We have initiated, under Minister Billson, a review, the Harper review, of the Competition and Consumer Act which is dealing with those precise issues. It is seeking feedback from farmers groups, from food and grocery councils, from consumer groups and from small businesses to ensure that our Competition and Consumer Act is a 21st century document that deals with the reality of market power and of how it is used and sometimes abused within the context of our domestic economy. I am very proud of a minister that has taken those recommendations by the horns and is dealing with that through the Harper review, and I look forward to the continuing outcome of that particular process.

But we are not alone in our moves, as a federal government, to improve the food processing sector. In my home state of Victoria, the coalition government has seen Victoria's food and fibre exports increase from $7.3 billion to a record $11.4 billion this financial year, an increase of 56 per cent. There were 77 trade missions to 33 countries which support over 3,000 Victorian businesses, developing a $100 million Food to Asia Action Plan and a $6.2 million international engagement strategy.

Where the former federal government failed in promoting trade, the state coalition government of Victoria has been exceptional under its agriculture minister, Peter Walsh, its regional development minister, Peter Ryan, and its Premier, Denis Napthine. The three, as a triumvirate, have been unrelenting in their promotion of our food and fibre industry and in their promotion of our state not only domestically but right throughout the world, leading super trade missions. I sit on the Joint Standing Committee on Foreign Affairs, Defence and Trade, and right now we are conducting an inquiry into the potential for a trade agreement with gulf nations. But from what we are hearing through submissions, everyone we talk to talks about the superior approach of the Victorian government when it comes to promoting their local product in an international market.

Hats off to the state coalition government for promoting the great state of agriculture, Victoria. The Victorian government has just announced a $48 million dairy investment in Pactum Dairy, creating 52 new full-time jobs in Shepparton. Similarly, at Australian Lamb in Colac the state government has announced a $2.35 million plate freezer investment to boost exports, creating 25 new jobs. Hardwick's Meat stage 1 boning room and cold storage expansion, another project announced by the state coalition government, includes a $1.5 million investment, generating 50 new jobs. It is projects like these that ensure our food processing industry continues to thrive, and I welcome the commitment from the recent government response.

I similarly congratulate Premier Denis Napthine, Deputy Premier Peter Ryan and the Victorian Minister for Agriculture and Food Security, Peter Walsh, for their ongoing efforts in improving the food processing sector. I want to stress to the people of Victoria that the food processing sector is such an important industry to a state economy, and this current state government is committed to further investment. It is only a state coalition government that will deliver that investment and those jobs directly into regional Victoria—directly into Colac and directly into the heart of the food processing in my state in Shepparton.

Just while I am on Shepparton, I want to recognise the two days that we had in Shepparton whilst we were conducting our inquiry. Shepparton is in the seat of Murray—the former 'Black Jack' seat—where I know our current candidate, Greg Barr, is running hard and supporting the local food processing industry and is very welcoming of this state coalition government's continued investment into jobs and food manufacturing in central Victoria. It is part of my state, as a Victorian senator.

We heard from Fruit Growers Victoria, Greenham and the Greater Shepparton City Council. We had the Australian Dairy Industry Council. What a great fortnight it has been for dairy. Thank you, Minister Robb. We heard from Hazeldene's Chicken Farm, looking at poultry and growing a variety of food production and at being able to process them in regional Victoria. Getting them to market and to port is another important goal, and the state coalition government is committed to ensuring the East West Link will provide a transport network that will ensure the great clean, green product that is being grown and processed in Victoria will be able to get onto that port, get out of that dock and get to the markets that are waiting for it right around the world, thanks to the super trade missions of the state coalition government. Vote 1 coalition this Saturday.

Question agreed to.