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Democrats call for new approach to National Competition Council.

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MEDIA 04/941



Democrats call for new approach to National Competition Council The National Competition Council should be abolished, its $181 million of recommended fines on the States waived, and National Competition Policy reviews ended, the Australian Democrats say.

Democrats Agriculture spokesperson Senator John Cherry, who met today with the South Australian Farmers Federation, said National Competition Policy had been a disaster for rural industries and should be ended before any more damage is done.

"At present, the National Competition Council is targeting the single desk for barley in SA and WA and marketing arrangements for chicken, potato and eggs in various States," Senator Cherry said.

"The deregulations recommended by the NCC will clearly leave farmers worse off, just as the NCC-driven deregulation of the dairy and sugar industries have left farmers worse off.

"Since dairy deregulation four years ago, the big retailers have increased their share of milk prices from 17% to 22%, while the share going to struggling dairy farmers fell from 42% to 25%.

"Despite this evidence, Federal Treasurer Peter Costello accepted without amendment, the recommendations from the National Competition Council for $181 million in fines on the States for not proceeding with more deregulation, and the State Labor Governments have largely given in.

"The time has come to end this madness. Orderly marketing arrangements for farmers are essential to redress the imbalance in market power between farmers and their buyers.

"Without such arrangements, farmers will see their incomes fall sharply and the profits of the big retailer and processors increase at their expense.

"The National Competition Council needs to get off the backs of farmers and off the backs of small businesses in the liquor, pharmacy and newsagency sectors.

"The only winners out of its reforms have been big business, particularly the two big retail chains. Farmers are clear losers and consumers will suffer in the long run," Senator Cherry concluded.

The Democrats Competition Policy calls for a tougher Trade Practices Act to protect farmers and small businesses, including giving the ACCC the power to order market dominant firms to divest themselves of part of their operations to encourage competition.

Media contact: Pam Hose 0408 752 750