House debates
Thursday, 17 August 2017
Bills
Regional Investment Corporation Bill 2017; Second Reading
12:00 pm
Tony Zappia (Makin, Australian Labor Party, Shadow Parliamentary Secretary for Manufacturing) Share this | Hansard source
The Regional Investment Corporation Bill 2017 claims to achieve two outcomes, and both of them are intended to support the agricultural sector. The first outcome is to establish a national water funding program. Secondly, it's intended that this legislation will provide funds by way of loans to farmers during times of need and events that are beyond their control.
Governments, particularly the federal government, have an important leadership role in building the nation's infrastructure. Governments also have responsibility in building industry sectors, and in times of need to ensure that those industry sectors remain viable. It is in the national interest to do that. Good governments have always done that and should continue to do so. During the economic downturn of 2008 the Rudd government's economic stimulus measures ensured that Australia did not go into recession. Coalition members are all too quick to criticise the Rudd government's initiatives at the time, which saved Australia's economy, but they are just as ready to boast that the Australian economy has continued to grow every year for the past quarter of a century. That would not have happened were it not for the Rudd government's economic stimulus measures during a time of need.
Despite that growth, there have been industry sectors that have gone through difficult times and for which government intervention could have made a substantial difference. The farming sector is one of those industry sectors. Agriculture contributes significantly to both national employment and national economic productivity. It is and always has been a major economic driver of the Australian economy and contributes around $60 billion a year right now. A third of Australia's population live in regional or remote Australia, where those communities rely predominantly on the agricultural sector for their livelihood, as do many urban businesses and residents. The farming sector is also vulnerable to both fluctuating markets and variable weather conditions. This was no more evident than between 1998 and 2008, when the decade-long drought brought many farmers, including cattle farmers, to their knees. Coalition members conveniently forget that the long drought did more harm to most of the cattle growers than did the suspension of trade with Indonesia. They seem to have a memory lapse with respect to that, but I can say to coalition members: at the time, I spoke to many cattle farmers, who came to Canberra from around Australia. The drought was hurting them just as it was hurting farmers across the nation, and quite substantially. In the same way, coalition members pretend that the global economic downturn never really happened—until, of course, it suits their argument to say otherwise.
The Regional Investment Corporation Bill sets out the framework for establishing a government corporation—a quasi government bank—that will provide up to $4 billion in concessional loans to farmers or repayable grants to fund national water infrastructure. In keeping with the corporation's bank role, the skill set required of the three board members who will oversee the corporation include banking and finance, economics, financial accounting, and auditing.
As the name of this legislation clearly implies, this proposal is focused on supporting regional communities. Yet, when the Rudd government proposed a similar initiative, in partnership with the four major banks, to support the construction industry during the global financial recession years, coalition members ridiculed and opposed that proposal. How different is this proposal to that in terms of its objective? Indeed, that proposal was a partnership with the four major banks, who would have had a direct say in how the loans were made. Again, the double standards and hypocrisy of government members are evident.
Likewise, when Australian manufacturing industries were struggling, largely because of a very high Australian dollar, the Abbott-Turnbull government failed to intervene. In fact, the coalition government did the opposite, by taunting GMH to leave Australia, knowing that Toyota would follow suit and, in turn, end Australia's auto manufacturing industry. It was the most callous decision of the coalition government. It left Australia as one of the only advanced countries without a car-making industry, it left tens of thousands of Australians out of work and it left whole communities reeling. More Australians will lose their jobs over the coming months as the car makers finally close down their operations in Australia. The stupidity of that decision is that the loss of tax revenue to the government and the welfare payments it now has to make far exceed the assistance car makers were asking for at the time. Just as regrettable, the Australian dollar subsequently fell, as expected—which, once again, makes Australian car makers very competitive. Had the Australian dollar at the time been what it is today, perhaps the decision would have been different. Members opposite, who know nothing about the car industry, should think carefully about their comments with respect to what provoked GMH into leaving Australia.
I note that the member for Calare, in his contribution, lamented the loss of jobs from the closure of Electrolux. He, understandably, alluded to the devastating impact on the local community. I can relate to that impact, because it's happening in my own community. Yet there was no such compassion or care shown by members on his side of politics for the jobs of the auto workers in Adelaide and in Melbourne. They too have families and they were also working in factory jobs, just as the Electrolux workers were. I don't criticise the member for Calare, because he was not in this place at the time. But he makes the very same argument that members on this side of politics made in respect of the auto industry, which fell on deaf ears when it came to coalition members. The double standards are breathtaking.
My concern is not with the intent of this legislation but with the framework under which the corporation is being established and the influence of the minister in the role of the corporation. I note that both the Minister for Agriculture and Water Resources and the Minister for Finance have joint responsibility for the corporation. The reality is that this legislation is being driven by the agriculture and water resources minister, who will use the corporation for political pork-barrelling and to shore up seats in parliament for his side of the House.
I note that the corporation's headquarters will be in Orange, in the National Party seat of Calare. We're not told why Calare was chosen as the seat where the headquarters would be based, or why Orange was chosen. While I make no criticism of that choice, it would have been good for the minister to have come in and said, 'Yes, we looked at a range of sites, and for these reasons the headquarters will be based in Orange.' But we were not told. It was a decision made by the minister, who, under this legislation, has the power to do so. I have no problem with decentralising government operations from capital cities. But, again, I have no doubt from my travels around the country that there are many regional centres that would dearly love government operations to be established within them. If we're going to do that, at least let's look at it in a balanced way and then come back with justification for the decisions made by the government such as this one. But, yet again in this case, we are not told why Orange was chosen.
The more serious concern, however, is section 11 of the bill, which identifies the operating mandate for which the minister has responsibility. It is a mandate which includes, firstly, the eligibility criteria for loans and financial assistance. I will just repeat that: the eligibility criteria for loans and financial assistance rest with the minister. It includes 'directions on other matters'. It doesn't tell us what the other matters might be; it just leaves it open-ended. It is whatever the minister wants to give directions to the board about. And it includes the performance of the corporation, which effectively says to me that, if the minister doesn't like the direction that the corporation is headed, he can simply do away with the board and replace it. The mandate will be—and this is even more concerning—by way of a non-disallowable instrument. In other words, parliament doesn't get to see the mandate and cannot reject it if the mandate does not appear to be reasonable.
These powers give extraordinary control over the corporation to a minister who has shown his preparedness to pork-barrel and, even worse, his bias towards farmers in his part of Australia. We saw that with his handling of the water portfolio, which includes the Murray-Darling Basin. Firstly, the minister abandoned the return of the additional 450 gigalitres of water to the environment. We had a debate about this only the other day. But, even worse, when allegations of theft of one billion litres of basin water were made, he downplayed the seriousness of that. He refused to support a judicial inquiry into the claims, knowing full well that only a judicial inquiry would get to the bottom of the facts in respect to the claims being made because none of the other government departments or bodies that have been asked to look into the matter have the powers to do a full investigation and ensure that all the matters are addressed. Simultaneously, the minister says he wants a $4 billion bucket of money to build water infrastructure, while he shows little concern for alleged water rustling, as I call it, or water theft taking place under his very watch. He shows little concern for delivering on the Murray-Darling Basin Plan. He wants money because he argues that the nation needs to do more about storing water and having water available for our farmers when they need it. Yet, under his very nose, there are allegations that water has been taken away and he shows very little concern about that.
In closing, I support the amendment moved by the member for Hunter, and I do so because, as the member for Hunter quite rightly points out, this proposal comes at an $81.4 million cost to Australian taxpayers. There is no new money, as far as I can ascertain, in respect of the $4 billion. It is just a collection of money that will then be put into the hands of the Minister for Agriculture and Water Resources so that he can use it as he sees fit. It gives extraordinary control to a minister of government who has shown not only his preparedness to politicise his portfolio but his incompetence in managing the water portfolio. Yes, we need to support our farmers. The money that is being proposed under this legislation is already there. It's just a question of who decides which farmers get the support.
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