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Monday, 7 November 2016
Page: 2965


Ms CHESTERS (Bendigo) (17:28): I rise to speak to the Register of Foreign Ownership of Agricultural Land Amendment (Water) Bill 2016. Even though we know that Labor is supporting the bill, I rise to speak about it today because it gives me a chance to talk about water. Water is a big issue in Victoria—and I see nodding from those opposite. Whether you are in an electorate like Bendigo or you drive north to the Murray, all our farmers and all our towns can do is talk to you about water and the cost of water. Whilst the government has made a big show and done a lot of grandstanding about how great this bill is, let us just be clear about what this bill does and what it does not do. It does not tackle the big issues that communities in regional Australia, and particularly in Victoria, are calling for—that is, a review of water and water pricing.

This bill is the enabling legislation to allow for the collection of information and the publication of statistics about foreign holdings of registrable water entitlements and long-term contractual water rights. All it does is tell us about who owns water. All it does is tell us about the foreign holdings of registrable water. It is tinkering at the edges. That is the best way to describe this legislation. It demonstrates how this government are not serious about tackling the real challenges in the regions. Instead, they tinker at the edges, they gloss over things and they go back to their stakeholders and say, 'Great news: we have done something significant.' But the stakeholders are not convinced, and they are right.

I recently had the opportunity to meet with a number of dairy farmers in northern parts of Victoria and learn firsthand how close they came this season. As you know, it has been raining in Victoria. We welcome the rain, but what I learnt when I was talking to these dairy farmers just north of Shepparton was how close they came—how they were literally saved by the rain. The price of water in our part of the world did skyrocket last year. They were paying up to $300 per megalitre of water. It has since dropped down to $62. They said the saving grace was the fact that it started raining. With what has happened with milk prices, with what has happened with Murray-Goulburn, they said that, if it had not started raining, many of them would have put their farms up for sale. I met with 11 dairy farmers and they all said the same thing: if it had not started raining, if the price of water had not dropped, then, because of what was happening to milk prices, they would have put their farms up for sale. Where would we be today if that had happened?

Water is an issue which we need to have a robust debate about. We need to start debating and looking at the water market. We need to do more than just establish a register of foreign ownership of water entitlements and publish the data on it. We need to actually look at the competition aspects of the water market. I have serious concerns that many people are speculating in the water market and that they trade on drought. I think it is a manipulation of what is going on not just in the dairy industry but across the board.

We have great, integrated businesses like Kagome. They produce tomatoes—they are basically responsible for a lot of tomatoes up north—and they say that, again, water is one of the big cost factors. They are not opposed to foreign ownership. They are a vertically integrated company. They have an investment partnership in Japan—hence the name 'Kagome'—but the operations are still organised and run here in Australia. They are a great example of how foreign investment can help grow our agricultural businesses. That is something where this side of the House is very different from the other side. Unlike the government, Labor understands the importance of foreign capital for increasing the productivity and profitability of our agricultural sector, and Kagome is a very good example of that. However, they say the challenges that they face in their industry are the costs that blow out.

If wages went up by 400 per cent in one year, imagine what regulation or legislation or focus this government would have on wages. They rant a lot about productivity. They rant a lot about unions, about wages and about a wages explosion. What they do not rant about is the other cost factors that blow out, like the cost of water, electricity or gas, and the impact that these cost pressures are having on our agricultural sector. It is disappointing that the government are not taking the price of water more seriously. Perhaps it is because of the internal tensions that they have within their party. On one side they have the investment bankers in the Liberal Party who are very pro the water market, and on the other side they have the Nationals, who are closer to the farmers and closer to the land. Perhaps they cannot get that marriage between the two halves of the coalition right, which is why we are not seeing serious reform and a serious discussion about pricing, about water and about the water market.

There are places where the market is not always the solution, and I believe that water is one of those areas. There are a lot of farmers who really struggle in drought years. One of the farmers in my area who spoke to me last year came to me with an example in cropping. Basically, to get the crop to a yield where he could make a profit, he said he had to do a cost-benefit analysis: if he spent $200,000 on that final water to get the crop ready for sale, what price would he get and would he actually make back the money that he spent on that water? He worked out that it was not worth it. It was not worth putting that final water on the crop, so he ploughed the crop, sold it at a stockfeed rate—a low rate—and copped a loss on that crop. If the price of water had not been so high, if it had been this year—this year they will get better returns, because the price of water has dropped, as I have said. This year they are hoping for a better year.

Our farmers, and particularly our dairy farmers, are productive. They are very productive and, when you talk to them, you know that they have done all they can to make their farms and their businesses as productive as they can, yet they are still struggling. They are falling behind each year. The dairy farmers that I met with do not live as millionaires. The ones that I met with, who I had a cup of tea with and spoke with at the front of their house, live in simple homes—but they are their homes and they are proud of them. One particular dairy farmer who I spoke to, in the 16 years that he had owned, co-owned or co-shared dairy farms, had only twice not been able to break even—twice. That is pretty good, considering the exceptional circumstances that our dairy farmers have faced over the last 16 years, whether it be drought, flood, water prices, or Murray-Goulburn and what they have done to the milk prices. Yet when they were hit by Murray Goulburn they did not qualify for the concessional loans—another policy that the government has championed—and even though Rural Finance said, 'Yes, we will consider you as a client,' their bank did not guarantee them. So this is just another example of how the government misses on creating policy which will deliver real outcomes for people in the regions. Labor supports this bill, but, as I have said, the bill is really tinkering around the edges and it does not deliver the kinds of reform and support that we need to grow our agricultural sector.

Another thing that dairy farmers said to me was, 'If one more person tells me that we will be the "food bowl of Asia" I am going to punch them.' You cannot keep making these bold claims that our region will be the food bowl of Asia if you do not have proper investment in these areas. That is why we in Labor understand the importance of foreign capital to increase our productivity and profitability in the agricultural sector. It is also important to note that we will continue to push for further transparency in both the land and water registers, because there is a lot of scepticism within our community and not just in relation to water. There are lots of different understandings in the community about who actually owns are water—whether they be true or not. One person suggested to me that the Prime Minister owns all of the water and that next time he is in parliament could he give it back to Shepparton and the Shepparton farmers. I do not know if that is true. Perhaps this register may help provide some answers to that.

There is a need for further transparency in both land and water registers. We saw that particularly with foreign ownership of farms. Despite a lot of the scaremongering saying 'China are buying up all our farms' when the statistics came out we found out that Chinese nationals have bought a very small percentage of farms and farmland. It is important that we have transparency in both land and water so that people know the facts. Properly designed registers will help build public confidence in foreign capital, and being more transparent is a crucial step in achieving this objective. However, we need to make sure that in all cases of public policy we are addressing the needs of the community.

When I talked to the farmers—whether they be the dairy farmers up north or the croppers and wheat farmers around Bendigo and the Marong area—they said: 'Is this all the government has to do? This is just crazy.' They want to see a government that is real about investment in agriculture. They want to see a government that is going to take on some of the tough issues that we have in agriculture, not just do this window-dressing. Creating these registers for transparency is important but it should not be the main game. I call on the government to really take seriously the concerns that the agricultural sector are raising around the cost of water. We need to look at how that water market is working. We need to make sure that we review it and that it is fair. We cannot have another situation occur that has occurred up north, because it may not rain next time. The next time this kind of disaster hits up north, it may not rain to save the farmers.

We see price spikes where in 12 months it goes from 300 down to 62 and back up to 300. I reiterate: imagine if wages spiked like that. We would see bill after bill in this place, with speaker after speaker demanding that wages be cut and that there be some kind of government intervention. But we have not seen those opposite suggest that for water; we have not seen any suggestion from those opposite that it is even an issue. I strongly encourage the government, if they are serious about our agriculture sector and seeing jobs and growth in that sector, to do more than bring in window-dressing policy like this. This policy is good and we support it, but it is clearly not going to be enough for people in the industry. They want to see real action on water.