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Tuesday, 7 May 1985
Page: 1781

Mr CLEELAND(8.51) —I have never before had the privilege of following the honourable member for Wakefield (Mr Andrew) in a debate but I am glad that I now do because, quite frankly, he spent over 15 minutes discussing nothing. He forgot to mention the point that there has been a real increase in Commonwealth funding of 0.25 per cent. After listening to his speech one would have thought that the Government was neglecting and running away from our rural industry. The fact is that the Rural Industries Research Bill provides for another 0.25 per cent in funding, which is an increase, not a decrease.

These Bills represent yet another important commitment by the Hawke Labor Government to agricultural industry. They will bring about improvements in the organisation and administration of existing rural industry research funds. In addition to the administrative and organisational improvements, the Bills provide for research funds on a matching basis up to a maximum contribution of 0.5 per cent of the gross value of production for each of the industries concerned. I have already indicated that there is an increase of 0.25 per cent over the miserly allocation which those opposite would offer if in government. So I find it very hard to stand here tonight as part of the Government, having listened to the shallow criticisms coming from the opposite side of the House.

Mr Millar —You have the option of sitting down.

Mr CLEELAND —The honourable members in cockies corner always spout forth. They are like a chook with no head. The proposed increase is an expression of faith by the Hawke Government in the future of Australia's farmers. We do not denigrate them at all. It is the recognition of the value of our rural industries to the Australian economy. For the second successive year Australian farmers have experienced good seasonal conditions. Livestock numbers, particularly sheep, are increasing and the wheat crop this year is the second largest on record. At the same time there has been an upturn in world economic activity. One would have thought that under these favourable conditions the rural sector would be looking at a very rosy future. This, unfortunately, is not the case; the aggregate net value of rural production in this financial year, after adjustment for inflation, is likely to be around 17 per cent below that of 1983-84. This places the index of the real net value of rural production some 8 per cent below the long term trend.

There are three principal reasons for the decline in the net value of rural production. The first, and probably the most important, is the agricultural policies of Australia's major trading nations. The European Economic Community's protectionist policies and subsidisation of inefficient European agricultural industries have led to a glut of agricultural products on world markets. Much of our present rural industry was built on the premise that we would be the food bowl of the world, particularly of Great Britain, and Europe. The close bonds felt by most Australians to Great Britain led us to Gallipoli, where the cream of our youth bled for the glory of the Empire. In the Second World War our troops were again utilised to the advantage of Great Britain in a conflict of European origin. Our farmers were very active in keeping Great Britain alive during those terrible years.

One would have thought that our sacrifices as a nation would have led to reciprocity and that our loyalty would have guaranteed our farmers a market in Europe, particularly in Great Britain, and that, indeed, loyalty and sacrifice were a two-way deal. Australia knows the history of what its sacrifice and loyalty to Europe and Great Britain in the past have produced. It has been found that our produce is denied access to European markets. Australia and New Zealand were again sacrificed to the glory of the Empire. Some glory, and some Empire! It is not as though our agricultural production is uncompetitive. Our farmers can produce cost effective goods and can compete fairly in any world market. Attempts in the past week to reopen discussions on the General Agreement on Tariffs and Trade have been blocked by the French. Surely there is a no more singular and isolationist nation than France, a nation where our war dead lie in their thousands, a nation which ignores the world and which, in the Pacific region, still acts in contempt of indigenous inhabitants' rights and wishes. The colonial mentality lives on in Europe and exacts a heavy toll from our farmers.

The first problem I mentioned is the direct course of the second major problem; that is the high levels of accumulated stocks in nearly all major rural commodities. I refer to commodities which are being dumped at well below realistic cost in world markets. The third major problem concerns the increased costs of production. In the face of these difficulties farmers in Australia have demonstrated their capacity for change-not change for change's sake but change in response to economic reasons. Farmers are constantly reappraising their methods in response to economic circumstances. Many changes are quite small but in aggregate they represent the means by which farmers continually increase productivity in the face of adverse trends which have confronted them.

Dalgety Farmers Ltd recently conducted market research which examined, among other things, farmer aspirations, productivity measures, input expenditure intentions, the type of service likely to be in demand in the future, and the availability of funds to meet the various demands of the farming community. Some 1,222 farmers were interviewed in all States except Tasmania. They were involved mainly in the beef, sheep and grain industries. Some of the results are of interest and, indeed, pertinent to this debate. More than 46 per cent of respondents expressed a positive interest in diversification, with grain producers more interested than sheep or beef producers. Fifty-three per cent of respondents under 50 years of age expressed a positive interest, compared with only 35 per cent over 50 years. Around 70 per cent of all beef, sheep, wheat and grain producers estimated that in the future they would be involved in more intensive farming methods.

The availability of diversification and more intensive farming methods is in turn tied to rural research and the dissemination of research information to farmers. As the Minister for Primary Industry (Mr Kerin) indicated in his second reading speech, three recent inquiries into the role of the Commonwealth in rural research all recommended substantial changes. It is of interest to listen to those opposite who say that there has been no consultation. They have forgotten those three inquiries and the intensive consultation which was carried on with rural industry in the course of those inquiries. Changes recommended by those inquiries are now being recognised in the Bills before the House, particularly in regard to research conducted through the rural industry research funds. There was evidence to suggest that the funding of rural research has been declining in real terms in recent years, particularly the producers' and the Commonwealth's contributions, in spite of the 1976 recommendations by the Industries Assistance Commission that funding be maintained in real terms at the 1976 levels. There also appears to be scope for the more effective use of scarce resources in agricultural research. In a recent review of pasture, crop and animal systems initiated by the Standing Committee on Agriculture, it was concluded that greater integration and co-ordination and co-operation both within and between research organisations was needed. The review stated:

The view of the working party is that currently there is too much fragmented single-objective research . . . There is a need to ensure that expenditure on research activities is rationalised in order to ensure that physical, biological and economic restraints to increasing the efficiency of agricultural production and marketing are approached in a co-ordinated manner.

I believe it is a truism that if substantially more resources are to be devoted to rural research most will have to come from producers through an expanded rural industry research levy system. They are ultimately the beneficiaries of such research. For producers to be convinced that it is in their own interests to expand rural research funding through an expanded levy system they must be convinced, first, that those funds will be used effectively, implying a possible review of the organisation and the setting of priorities for research. Second, they must be convinced that expanded producer contributions will not just be offset by lower direct government contributions. The challenges for Australian agriculture are not short term. There is no panacea for immediately improving the current situation of low farm income levels. To improve the income situation of farmers, there will need to be progress in all areas where policies have a bearing. There is no short term pick-up in sight in the world trading environment but the longer term is more promising. This Government recognises the necessity of a more coherent, integrated national approach to rural research. Agriculture has shown that it can battle and adjust to fluctuating economic fortunes. In that battle it has the support of the Government. The Government is serious about attacking farm costs, improving farm productivity and taking the tension out of the cost-price squeeze. This Bill represents a significant expansion in research expenditure and at the same time rationalises expenditure on research activities. I commend the Bill to the House.