Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

I must address the final comments by the previous speaker, the member for Wannon, who spoke on the Farm Household Support Bill 2014 and the Farm Household Support (Consequential and Transitional Provisions) Bill 2014. He said that the outlook for agriculture in Australia is wonderful and that he has every faith and confidence in it. I do not think anyone in agriculture, listening to his speech, would have any confidence in him. If you come in here and make stupid statements, you should be made to pay for it somewhere. Let me just narrate to you the ridiculous nature of his statement. I do not know where he comes from in Australia. But if he comes from Victoria—

Mark Dreyfus (Isaacs, Australian Labor Party, Shadow Attorney General) Share this | Link to this | Hansard source

The Western District of Victoria.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

Western District of Victoria—well, that makes it quite extraordinary!

Sussan Ley (Farrer, Liberal Party, Assistant Minister for Education) Share this | Link to this | Hansard source

You come so infrequently, you do not know where anybody comes from.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

The lady representative government of the dispatch box—

Rob Mitchell (McEwen, Australian Labor Party) Share this | Link to this | Hansard source

That would be Minister Ley.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

just made a comment that I do not know where anybody comes from.

Sussan Ley (Farrer, Liberal Party, Assistant Minister for Education) Share this | Link to this | Hansard source

You do know where I come from!

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

Well I hope that I do not because I do not want to be personal in my comments. I do not direct personal attacks where I can avoid them, unless I am really provoked, but I do want to address what the former speaker said. The member for Wannon said the output for agriculture in this country is good. The honourable minister at the dispatch box, the Assistant Minister for Education, represents a country area in Australia. I would like to throw to Minister Ley the challenge that she will answer what I am going to say about agriculture in Australia. This is not an opinion of a member of parliament; these are the actual ABS statistics.

The Weekly Timespublished a major article saying just that, and I hope that the minister at the dispatch box reads the Weekly Timesprobably the only agricultural paper in the country worth reading, most certainly in Queensland. The Weekly Times said that Australia is going to be a net importer of fruit and vegetables. I think this is quite extraordinary. Australia is already a net importer—not going to be, but is a net importer of fruit and vegetables. I got five separate sets of statistics out from the Library and there was no doubt whatsoever that Australia is a net importer of fruit and vegetables.

We have people in this parliament who come in here and make stupid statements that outrage and anger the farming community of Australia—not anger or enrage them to the point where they change their vote, but anger and enrage them and make them very cynical towards all politicians, which they are entitled to be. They say, 'We are going to be the food bowl of Asia.' How ridiculous—how utterly ridiculous! We will be a net importer of food from Asia and there is no doubt about that. Let me return to fruit and vegetables. We are a net importer of fruit and vegetables, we are a net importer of pork and we are a very big net importer of seafood. Five or six years ago, we were big exporters in all of those items. To give you some sort of perspective, if you draw a growth line on prawn and fish farming in China and extrapolate it out to 2050, then it is a fair call that almost all of the protein on earth will be coming from prawn and fish farms in China. I am not saying that China will increase its present production levels but it can. It does not need any area of land, not that China is short of land covering maybe a fifth of the surface area of the world. Even if it was short of land, prawns and fish can be produced in the ocean in nets. So those are the three items where we are already importers. That fruit and vegetable figure is prior to SPC Ardmona, Golden Circle, Simplot and McCain all getting into serious trouble. I predicted in this place on many occasions that unless something was done about the car industry we would have no car industry within seven years. Well, I was dead wrong—it was seven months after I made that statement that all three of them announced their closure. I find it very difficult to see how fruit and vegetable processing in Australia will be able to remain viable. It is no fault of the workers in those plants and it is no fault of the management in those plants. Rather, it is the problem we have in agriculture.

Let me switch from fruit and vegetables and pork and seafood to the major players in agriculture in Australia, starting with the beef industry. Our figures show, before this drought and before the wicked decision by the ALP government to ban live cattle exports, we were down to 23 million head of cattle from a herd level of 33 million head—and it should be more than that today. The wool industry was the biggest exporter in this country before Mr Keating, as Treasurer of Australia, wrecked it completely. Until that point, wool was a bigger export item than coal. This country was still riding on the sheep's back in 1990 before that person destroyed the industry. The sheep herd has fallen 63 per cent. Sixty-three per cent of that great industry which kept this nation going for nearly two centuries has all but vanished—wool is not up there as one of the serious export items anymore. The third item I want to talk about is dairying. No-one in this place needs to be told about dairying. We told, we pleaded, we howled and we cajoled, saying 'Do not deregulate the dairy industry! Look at what has happened in Victoria, where they deregulated it into the Melbourne markets. Do you want that all over Australia?' They would not listen so they deregulated the dairy industry. The dairy herd is down 31 per cent. The export of dairy products is down very significantly, though I do not have the figure with me at the present moment.

When a person gets up in this place and says the outlook for agriculture is bright I would like to know where it is bright. I would like to know where this brightness is coming from. I went to a meeting in Meridan where 1,200 wheat farmers turned up. I have attended three or four meetings in Victoria and there would have been over 1,000 people at each of those meetings. They tell me over 6,000 people attended those meetings. Near the area of the honourable minister at the dispatch box, the member for Farrer, 14,000 people came to the meeting in Griffith. So, we have all of these happy farmers who are doing so well and can look forward to a bright future! I want a member of the government or the opposition to stand up and tell me where this brightness is coming from. Maybe they are referring to the grape industry or the citrus industry—or what is left of those industries. And you ask what is left of those industries. It has got nothing to do with the drought.

We praise the minister and the government for improving this proposal which came forward from the Labor government. We thank the Labor government and the former Treasurer and Deputy Prime Minister, Wayne Swan, for introducing this concept. But, I want to put on record the people from whom this concept originated. This concept originated with the Mareeba Rural Action Council. I have never seen such a band of tenacious and unrelenting fighters. The honourable member for Mallee spoke in this debate earlier; he was head of the Victorian Farmers Federation. I would like to know what our farming organisations have done for us over the last 30 years. I would like to know one thing that they have done for us in the last 30 years. Almost every single initiative that has been worth two bob has come from spontaneous, people-on-the-ground, grassroots movements. I speak with great anger because my industry, the cattle industry, was nigh on destroyed by the inaction of the MLA, the NFF and all of the other bodies associated with the cattle industry who knew what was going on in Indonesia and chose to do nothing about it. When we saw what we saw on Four Cornerswe criticised them for it—nothing was done by any of those organisations, including the Victorian Farmers Federation, including New South Wales Farmers Association and including AgForce in Queensland. None of those organisations moved to do anything about sending stun-guns and knocking boxes up to Indonesia and acting on what needed to be acted upon immediately.

The people who have led this fight that has culminated in a great decision by the previous Labor government and an excellent enhancement of that decision by the existing government are: Johnny Gambino—no-one can underestimate the importance of this person to rural action throughout Australia; he was one of the founders of the serious mango industry that we have in Australia today; Bernie O'Shea, who many times appeared on television to the great benefit of every single farmer in this country even though he does not come from a farming background; Max Srhoj, the person who pushed me to get out of the party system in this country as it existed so I could stand up and fight properly for the people I am supposed to be paid to represent, and one of the most successful farmers and one of the very few successful farmers that we have up on the Atherton Tableland area, which produces about five or six per cent of the fruit and vegetables we are still producing in Australia; Ned Bruschetto, who spent some years on the council up there as an excellent councillor; Vince Mete; Johnny Myrteza; Peter Henderson; Kevin McGrath who, again, served many years on the council; Joe Moro, who has been a great leader up there for many years; Lidio Nicolosi; and Scotty Dixon, who will fight till the day that he is pushing up daisies—what a great asset he has been to the team up there.

Why are we in this situation? We are in this situation because our RBA interest rates have been set at 3.2 per cent, on average, for the past two or three years. The rest of the world averages 0.27 per cent. That is a 1,000 per cent difference. It is not a 10 per cent or a 50 per cent difference; it is a 1,000 per cent difference! Every farming organisation and farming representative in this place should be screaming it from the rooftops on a daily basis—heaven only knows I tried to. If you have interest rates that are 1,000 per cent out of step with the rest of the world then clearly you are going to have a currency which is wildly overvalued. That value should be at US50c. That is not my opinion; that is the opinion of the international monetary markets.

Mr Keating did something very good: he allowed the dollar to free float, and it went down to US49c. When Mr Costello came in he did a very good thing: he allowed the dollar to free float. These people advocate free markets. They both did the right thing. They were as good as their word; they came in and they allowed the dollar to free float. And it went to US52c. So, when the dollar was allowed to free float, it went to US49c and US52c, and then our terms of trade deteriorated disastrously from that point. We were running current account deficits of $10,000 million; we are now running a current account deficit of $60,000 million. That is creeping up to a significant percentage of the entire budget of the Australian government.

Worldwide, the level of support for agriculture subsidies and tariffs is 41 per cent—you can get this information from the library or from the OECD website. Australia's was 4.5 per cent the last time the OECD released international figures. We have the Coles/Woolworth situation. No other country on earth has a situation like that. In America, the big two have a 23 per cent market share and the Americans are squealing blue murder. The big two here have somewhere over 85 per cent of the marketplace. We need collective bargaining. When it was taken away from us in the milk industry, in the sugar industry and in other industries, we were crucified. under collective bargaining in the year 2000 we were getting 59c for fresh milk in North Queensland. Our farmers are now being paid 48½c.

Moving to ethanol, ethanol fixes up the cattle industry, the sugar industry and the beef industry. We would not need drought support if we had an ethanol— (Time expired)

Kevin Hogan (Page, National Party) Share this | Link to this | Hansard source

I will eventually bring the discussion back to the Farm Household Support Bill 2014, which I have not heard a lot about in the last 15 minutes. I do want to take up what the member for Kennedy just said. He has raised some interesting points. He made reference to the contribution by the member for Wannon, who spoke earlier. Some of the statistics that the member for Kennedy just cited are true. Our agricultural sector certainly faces some serious challenges, and they are issues that we need to get right.

The member for Kennedy challenged any member of parliament to give him a positive or an optimistic agricultural scenario. My electorate shares the challenges that he describes in the sector. One of the biggest private employers in my electorate is an abattoir. They certainly were very much harmed, as the industry was, by the live export ban. We saw cattle prices decrease significantly because of that.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

That helps the abattoirs.

Kevin Hogan (Page, National Party) Share this | Link to this | Hansard source

Well, it did not help them, because all the cattle that were supposed to be sold offshore moved south and, as they moved south, our market was inundated with cattle, which completely depressed our prices.

Mr Katter interjecting—

It does, but it certainly did not help industry. I think that harmed the industry, and the drought certainly has not helped either. The positive story I have to share with the member is that they have been actively searching and finding new markets for their product. There have always been an exporter of their product. Almost 70 per cent of their product gets exported. For example, 18 months or two years ago China bought hardly any of their frozen boxed beef; it is now a significant buyer of their product. They are optimistic about their future. They are a cooperative. The cooperative is positive about their future. With rain—which I will get to in a minute in relation to this bill—they are very positive about what can happen when the restockers come back into that market.

The member for Kennedy mentioned the dairy industry. I have a dairy cooperative in my electorate, and they too are very optimistic. They have certainly faced challenges with the supermarket duopoly, which the member spoke about. But they too are positive, because just this month they accessed a new market in Asia, not just for dairy but for fresh milk. This is because of what is happening with some of the export protocols that we are dealing with, one of which relates to Korea, where tariffs on our agricultural products have been reduced. So, I say to the member: I hear you on some of the challenges faced by the agricultural industry, but there are positive stories out there. I certainly share the member for Wannon's optimism on agriculture.

I do want to talk about the bill that we are supposed to be debating. I would like to share with the House a letter written by a dairy farmer in my electorate. It refers to the drought, an issue which makes this bill so important. It was written by Leigh Shearman, who is a member of the Far North Coast Dairy Industry Group, DIG, and I have Leigh's permission to share it with you. In writing to the manager of North Coast Local Land Services in Kempsey, Leigh states:

Dear Nicole

I am writing on behalf of the Far North Coast Dairy Industry Group, our group represents 145 dairy farmers from Murwillumbah through to Grafton. The situation is deteriorating with every week that passes and no rain in sight. With pasture growth now non-existent and with only very limited dairy farmers able to irrigate under their water sharing agreements.

The cost of conserved fodder, which a majority of farmers are now totally reliant on, is escalating and very hard to locate. Corn crops that a lot of dairy farmers rely on for supplementary feeding when times are tight are only yielding very minimal returns, as is with a lot of silage crops. Dairy farmers are high grain purchasers and with the failed crops now really starting to push already high grain prices even higher the cost of production is rising beyond milk returns.

We cannot impress strongly enough that you keep dairy farmers in mind and act as quickly as possible to implement any support that is available. As most are aware dairy farmers are struggling financially under the cost of production and the climatic conditions are placing an enormous financial burden once again on an industry that is an important industry to our region.

If you would like further information I would be very happy to be of assistance.

That is a letter from a farmer who is obviously being affected by these climatic conditions.

Before going to the bill specifically, I would like to share a conversation that I had just recently with a person in my community, Anne Thomson from Eltham, who has supported drought appeals for 20 years and encouraged people to support people in drought, wherever the drought seems to be or where the money is needed. Obviously, there are times when there is no drought. She focuses on sending money, food and Christmas presents. She has no idea of how much, but she has raised tens of thousands of dollars over many years for drought affected people. An important point is that she often comments that the people giving that support are often pensioners, old people or people with very little income. They come along and see her every fortnight after they have received their fortnightly payment to give her a bit of money or a bit of food to share with people in drought. She has sent assistance in previous years to areas like the Riverina. This year she sending a lot to Brewarrina and Walgett and as far away as Lightning Ridge. One of her distributors, Betty, who lives between Moree and Mungindi, has been nominated for a senior citizen of the year award for distributing those gift parcels.

I wanted to start with those examples because they show two things for me: the real financial consequences of drought, as the letter from the dairy farmer showed, and the help that we see from everyday mums and dads trying to help people who need assistance. I think they are a good introduction to the fact that we as a government should also be providing some of that type of assistance.

One thing that I think we need to stress—and there have been a lot of conversations about this in relation to other industries—is the point that was made by the member for Parkes that this is not a handout; this is a hand up. This is not a structural problem for farmers. Our farmers, as was said, are some of the most efficient farmers in the world, and they have to be because we as a country give them very few subsidies. If you look at other countries around the world, they give huge subsidies to their agricultural producers—we have read about them and they have been well articulated in this place. We do not do that. We have made sure that our farmers are the best in the world because they have to be to survive. So this is not about a handout; this is about a hand up.

Climatic conditions are deteriorating as we speak. This bill, which introduces the farm household allowance, is a once-in-a-generation reform of government support. The timing is appropriate not just because of the drought but also because it is the International Year of Family Farming. We are also proposing this bill now because this cannot wait until 1 July when it was originally due to come in. It will replace the Farm Household Support Act, including provisions relating to the exceptional circumstances relief payment, and makes support much more responsive to farmers' financial hardship. It will provide time limited three-year payments and support for those eligible to improve their situation without the need for a climate trigger. The three-year support will provide farmers with time to plan for the future and to achieve financial security and self-reliance.

It includes a $2.55 million net farm assets test, which will be indexed, and off-farm and liquid asset threshold aligned with Newstart allowance, which excludes the principal home. This is higher than the mainstream assets limit in recognition that farm assets are relatively illiquid, especially—as you would appreciate, Deputy Speaker Mitchell—when these payments are needed and cannot be relatively drawn on for self-support. There is an income test consistent with Newstart allowance, but with a provision that means that off-farm income will not be regarded as income when it is used to pay interest to a bank or commercial lender. There are also provisions for automatic entitlement to a Health Care Card and waiting periods the same as social security payments.

There is support for the Department of Human Services to assess farmers and help them develop a financial improvement plan. I want to go into this in a little bit more detail later, but this is a really important part of this bill. It provides counselling, financial or otherwise. Farmers tend to be a fairly proud lot. They are obviously not employees; they are running their own business and are usually fiercely independent. So to ask for help, whether it be financial or otherwise, when they need it can sometimes be difficult. So part of this is to encourage that and to make access to that easier. It will also support farm families to educate their children. Parents receiving the allowance automatically meet income test provisions for the child's youth allowance.

Before I go into some of the details of the bill more in depth, I want to make a point because I was somewhat taken aback by the pessimism of the member for Kennedy's views on agriculture. I think we need to look at the positive contribution that it is making and the fact that, to my mind, it has great potential to grow. It generates now over $47 billion in gross value of production, so it is one of the main five pillars of our economy. Agricultural exports just last year were worth $38 billion. This is real money. This is money produced by the private sector, the agricultural sector. They are paying taxes. They are generating real wealth for this country, and I am very confident they will continue to do so.

Just in my region, the agricultural sector generates more than half a billion dollars, or about five per cent of our gross regional product, and employs directly over five per cent of the workforce. Most of these are small family-owned operations. I alluded to it before; there are some very positive stories out there in my community and I know they are replicated across the country. I have a dairy cooperative and a meat cooperative that have a positive story to sell. They are gaining access to new markets. They have new buyers who, come good weather, are going to push up prices, I believe, for many agricultural products. I have a blueberry farmer who is building quite an operation in my electorate who is very excited about his prospects of gaining access to markets in Asia and will employ—

Ms MacTiernan interjecting—

We love blueberries. We realise that blueberries are a wonderful anti-oxidant and we encourage all agricultural products. We have some of the most efficient farmers in the world. We need to help them in this short-term period, while climatic conditions warrant it.

I will put on record some of the specifics of this bill. The interest rates on the new drought concessional loans will be set lower—that is 0.5 per cent below the interest rate for the farm concessional loans. The previous speaker was talking about interest rates; the interest rates under this will certainly be lower than they otherwise would be. There are things in there for counselling, both financial and otherwise. There is a review, as part of this, that looks at drought preparedness, because while you can not necessarily prepare for all droughts—especially one that, in some cases, has gone on for so long—there are certainly ways that we can improve what we do. This bill will help with that. The drought concessional loans are going to be available to drought affected farm businesses that have already taken steps to prepare for the effects of drought, but which with some financial assistance can do more.

I will finish on the topic of my optimism for this industry. Fifteen or twenty years ago, people were very critical of the mining industry in the sense that it did not negotiate hard enough. It was not getting good enough prices for its product. Back then there were the BHPs and, I think, it was Western Mining then, not Rio Tinto. Their main buyer back then—their sole buyer, really—was Japan. What happened was that we had a new buyer who came into the market and greatly increased the prices and the viability of that industry. I am very positive about the agricultural sector and I support this bill to help them over their short-term climatic conditions.

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

Mr Deputy Speaker, I raise a point of order. I claim to have been misrepresented.

Rob Mitchell (McEwen, Australian Labor Party) Share this | Link to this | Hansard source

Does the member claim to be misrepresented?

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

Yes, I do, Mr Deputy Speaker. The previous speaker said that I had attributed this to the current federal government. That is not entirely true. I attributed it to this government and the previous government, but most of all to the Rural Action Council of North Queensland. They have developed the proposal and brought it forward and carried it by themselves for 10 years.

Rob Mitchell (McEwen, Australian Labor Party) Share this | Link to this | Hansard source

The Speaker made it clear today that if we are going to have these, you should check the record and then come back and do it. That would be good.

George Christensen (Dawson, National Party) Share this | Link to this | Hansard source

I rise to support wholeheartedly the Farm Household Support Bill 2014. In doing so, I pay tribute to the Minister for Agriculture and my good friend the member for New England. He is a man who is extremely passionate about Australian agriculture, particularly passionate about family farms, and about ensuring that farming families can continue on into the future. We have heard some talk in the public sphere—notably Paul Howes, the head of the Australian Workers Union—that farming families are no longer needed in Australia, that the ma and pa families are something of the past. I am glad we have a Minister for Agriculture that does not subscribe to that view. Because the many farming families throughout my electorate of Dawson—farming families who are engaged in enterprises such as sugar, tomatoes, capsicums, fruits, vegetables and cattle—want to continue, and they want their farms to be handed down through the generations. This is something that is in the blood. I could not grow a lettuce actually, I have to tell you, Mr Deputy Speaker, but I come from a generation of cane farmers. Every time I see a stalk of sugar, I want to hug it. It is something that is in the blood. I salute our Minister for Agriculture, who recognises this and wants to protect farming families in Australia, and I look forward to seeing a lot more positive policies from the Abbott Liberal-National government and the Minister for Agriculture to help this sector and farming families.

The bill before us seeks to implement an income support payment for farmers and their partners who are in financial hardship. It is called the Farm Household Allowance. Australian history has been a rich narrative of tough people battling tough conditions. Our reputation as one of the best agricultural producers in the world is counterbalanced with bouts of droughts and floods. While the harsh conditions are nothing new to our farming families, they operate in a different environment to that of their forefathers. The great wealth that was once produced by family farms during good times helped tide families over during the bad times. The boom times are no longer the boom times of old, in some respects. Increased competition, more regulation and a cost base, escalating due to things such as the carbon tax, make farms much more vulnerable. It certainly does not help when governments decide to shut down things such as the live cattle trade overnight and without warning. It does not help, as I said, when the government imposes a carbon tax that actually impacts on trade exposed industries such as agriculture.

Right now, though, our farmers—especially those in western Queensland and western New South Wales—are battling what is quite clearly the worst drought in a century. And in response to these tough times the Abbott Liberal-National government is delivering a range of measures to assist these drought impacted farmers. The measures outlined in this bill provide for up to three years of income support for farming families without the need for a weather related trigger, and that is very important. The means test will provide more equitable treatment for people who lack sufficient means to support themselves. The assets test will be higher than mainstream limits, recognising that family farms—the actual farm asset itself—cannot be drawn upon for self-support as easily as can other types of assets.

I note that we are a signatory to the International Covenant on Economic, Social and Cultural Rights and that article 9 of the covenant talks about the right to social security. This is a case in point in relation to this government acting for a segment of the population: when everything goes to hell, there is not adequate support for them. Through these measures, we are making sure that the safety net is indeed there.

So the government stands ready to support those in our community who are most vulnerable through no choice or fault of their own—they are simply subject to the vagaries of the weather and, unfortunately, to government policy of the day, which can sometimes be deleterious on their enterprise as well. But our goal is to ensure long-term self-sufficiency in the agricultural sector, and to this end the legislation that is before us includes provisions for a farm financial assessment and requires allowance recipients to enter into a financial improvement agreement. That means that recipients of government funds through this measure will undertake education or training or even off-farm employment that will increase their capacity and ability to deal with the situation that is before them and, frankly, to keep the family farming tradition alive in this country. When applicants meet those eligibility requirements they can gain access to further benefits, such as the health care card, the telephone allowance, remote area allowance, the clean energy supplement, pharmaceutical allowance and rent assistance. So, there is a range of different benefits that derive from this legislation.

The Farm Household Support Bill provides an income support payment for farmers that aligns with social security laws that exist in other areas, where that is possible. As a Liberal-National coalition government we want to ensure that farming families are treated fairly and that they have access to the same benefits and services that other families facing difficult circumstances have access to. For families who are living outside of the city, access to a whole range of services becomes something of a problem. Isolated families do not have things like regular waste collection services. They do not have access to community libraries. They do not have access to adequate sporting facilities, parks and recreational areas or even business facilities that we take for granted even in small country towns. As much as these things impinge upon lifestyle, it is far more serious when farming families reach the point where they have difficulty in just putting food on the table. When things are truly, truly tough, it is our responsibility as a nation to ensure that help is there. We do not want these families to feel they are completely cut off, with no hope for the future. Too many farmers have been in a position where they cannot see the light at the end of the tunnel, and we must do whatever we can to provide that light at the end of the tunnel—to provide, as I said before, an adequate safety net.

And I hope that we go further than just that. I hope that we are able to go further very soon in this parliament, and remove other impediments to the agricultural sector, such as the carbon tax, which I know equates to about $20,000 per farmer in the sugar industry. I hope we can actually pass reforms that get rid of all the red tape and regulation surrounding the process of registering agricultural chemicals. Here I must commend the parliamentary secretary, the member for Kooyong, for the work he has done in this field, because it will be of tremendous value to farmers right across the nation. The red tape introduced by the last government was completely unnecessary and did absolutely nothing, and the repeal of that red tape will put useful tools and agricultural chemicals on the farms quicker and at a cheaper cost. If there is one thing we want to do, it is to make life easier for these people on the land who are going through such terribly trying circumstances right now. We need to let these farming families know they are not forgotten. We need to let them know that we are going to help them through their darkest times. We need to let them know that we are going to help them to build a brighter future.

My electorate is a narrow strip of coastal North Queensland. It is about 400 kilometres that stretches from Mackay through to Townsville. It is a very agricultural electorate, taking in the largest sugar-producing region in the country. But it also has other agricultural, pastoral and horticultural industries; in fact, would you believe that Bowen—so famous for its mangoes—also produces two-thirds of Australia's winter tomato crop? That is the kind of electorate I come from—a very, very strong agricultural electorate. I have to say that, being on the coastline, my electorate enjoys a higher and more consistent rainfall—particularly after a cyclone comes along. But we have been in drought before. Coastal areas also suffer drought, but not for long, and not as harsh as those who are out in western Queensland and north-western New South Wales have had to go through. Our hearts go out to people who battle those dry conditions, day in and day out, sometimes for years on end. Australia has always held very romantic notions of the bush and the battler, despite the fact that most of us now live in urban area, probably just a few minutes walk from a local cafe, or a hairdresser, or a hardware store. However, the strong connection and affection for farmers and rural communities comes to the fore whenever our sunburnt country is in the grip of droughts, flooding rains, or bushfires.

When times are tough, people stretch out their hand and offer help. We like to think we all do—but in some cases we see situations where people are kicked when they are down. I have to note once more my disbelief that the green movement is coming together next week—in the middle of the harshest drought we have seen in a long time, while farmers are reeling from it, and from government policies—to promote vegetarianism and veganism to the entire nation with Meat Free Week. They want to encourage people not to eat meat for a week. That is why I have launched my counter proposal, the 'free meat week', where I am encouraging Aussies—and the member for Wright might get into it—to support Aussie farmers by putting on a barbie and shouting some free meat to their neighbours and mates. We need to stand up to this green movement, which kicks our farmers while they are down.

When times are tough, people who are real, genuine and compassionate stretch out their hand. Right now, times are very tough for our farmers. It is time for this government, in a bipartisan manner, to reach out a hand and deliver fairness, equity and a fair go to the people who put food on our tables. With those words I commend the bill to the House.

Tony Pasin (Barker, Liberal Party) Share this | Link to this | Hansard source

I rise today to speak on the Farm Household Support Bill 2014 and the Farm Household Support (Consequential and Transitional Provisions) Bill 2014. I do so as a proud representative of the farming communities in Barker. I was privileged to have a rural upbringing, and I continue to take an active interest in my families farming enterprise around Mount Gambier. That is a part of the south-east of South Australia that, thankfully, enjoys some of the most reliable seasons of any agricultural district in the nation—although, as we saw cruelly in years like 2006, we are far from immune to drought.

Barker, however, is a diverse electorate—64,000 square kilometres of diversity. Today in my electorate we are experiencing extremely dry conditions throughout the Mallee. So, while, thankfully, the current situation seems confined, tragically, the spectre of drought for those in Northern Queensland and New South Wales—just as it is in areas such as my electorate.

When financial hardship can strike more assured farm communities such as those in my electorate, as it has done in recent years—especially among local dairy farmers—we are reminded of the threat of more widespread drought in other areas of Australia. I have always believed that it is the responsibility of a good government to strike the right balance when it comes to exceptional circumstances. I think it is important to have a system in place to support those farmers who are experiencing extraordinary hardship, and provides them with the assistance they require for their livelihoods to be sustained with dignity and into the future.

I am proud to represent an electorate that makes a significant contribution to Australia's agricultural industry each year. It is a sector that, as other speakers have pointed out, generates over $47 billion of revenue nationally, in terms of gross value of production. Farmers throughout Barker contribute disproportionately to the nation's farm exports, amounting to total sales of approximately $38 billion in the last year alone. This income is absolutely vital to our entire economy, but particularly in regional communities such as those throughout Barker. When those sales literally dry up, due to tough seasonal conditions, our farmers need the support of the Australian government to ensure they survive the bad times, so that they can quickly thrive and capitalise when seasonal and market conditions improve.

Like others in this House, I have a bullish view of the future of the agricultural sector in Australia, and particularly for the agricultural sector in Barker. But one of the greats risks is the concept of generational farming. We need to ensure that farming is both profitable and attractive for the next generation of farmers that I hope, as I am sure the member for Mallee hopes, will come along with us on the extraordinary journey we are on in this place. I am very pleased that the coalition, through these measures, are doing everything that they can to encourage and assist farmers to adopt best practise farm management techniques and smarter business management strategies, so they can grow and adapt in the face of uncertain seasons and ongoing economic challenges.

We must also acknowledge that periods of extreme difficulty can be caused by a number of different factors and, importantly, this bill confirms the coalition's commitment to introducing a new Farm Household Support Payment to those in need of financial assistance. That is an important point. This is a needs based system. In the absence of the member for Grey, I must say as a regional representative from South Australia that, contrary to some of the media speculation early in this debate, this is a measure that will address the hardship being experienced by those farmers in northern South Australia. The member for Grey represents South Australia's pastoralists, in particular the ones who produce livestock in those areas, and this measure is available to them. That was done in response to approaches to myself, the member for Grey, and the Minister of Agriculture, by organisations including Livestock SA.

It is important to acknowledge the bipartisan way in which these changes have been supported thus far. I commend the members on the other side of the chamber for working with the government to implement these important changes. Nonetheless, I know there are those that have been critical of the coalition's commitment to provide this kind of assistance to farming families in need. To be honest, I think anyone who does not support this kind of package either is trying to play politics with this very important issue or has a shameful lack of appreciation for the agricultural sector and food production in particular.

I think it is clear that these measures will address many issues faced by farmers in drought, including rising debt levels, the capacity to make household payments, limited water for livestock, personal stress and the management of pest animals. This is reflected in the way that industry has welcomed these changes since they were announced in February.

In looking for a moment at the bill in more detail, I note that the farm household allowance provides: three cumulative years of income support for farmers and their partners in hardship without the need for a climatic trigger; a $2.55 million net farm assets test where the principal home is excluded; an income test consistent with Newstart allowance but with a provision that will allow off-farm income to be disregarded as income where it is used to pay interest to a commercial lender; automatic entitlement to a healthcare card; waiting periods consistent with social security payments; support from a Department of Human Services case manager to help assess a recipient's situation, develop financial improvement agreements and then fund activities set out in the agreement; and a compliance framework to ensure obligations are met to address fraudulent activity. Of course, it is important not to lose in this debate the very significant stress placed on farmers in drought conditions. As someone who has worked with a disproportionate number of people in my previous professional life who suffered mental health conditions, can I say we must never forget that at these times of high stress.

I know that the relief package was a major topic for discussion when I hosted the Minister for Agriculture in my electorate of Barker on 18 and 19 February in advance of this announcement. We met with a number of livestock producers and mixed with farmers from throughout the south-east and even parts of western Victoria, represented so well by the member for Wannon. The late Tuesday afternoon at the Mt Gambier saleyards, where preparations were being made for the following morning's weekly prime cattle, sheep and lamb market, was a very suitable backdrop for a discussion about the relief package, which had only just come to significant media attention. We know that the physical markets are nearly always still the best barometer for how the livestock industry is travelling during these tough times of drought. Even though the seasonal conditions that we speak of are far away in northern New South Wales and Queensland, they still impact on the markets in the south. It is a consistent reminder of how all Australian farmers are so closely linked together within this industry, no matter how many thousands of kilometres separate us.

At that gathering we had members of a number of significant primary industry organisations, including Mr Andrew Ogilvie, who is President of the Cattle Council of Australia and a local beef producer. We also had in attendance the President of Livestock SA, Mr Richard Halliday, and the Vice President, Mr Jack England—both of whom are also south-east farmers. I was also pleased to welcome the Mackillop Farm Management Group Chairman, Mr Duan Williams, and his deputy, Mr David Farley. The Mackillop group is an exceptional regional-based producer network that is independent and proactive, and develops innovative and sustainable farming practices through research and extension for the benefit of primary producers in the south-east. They are very much a can-do organisation.

The relief package was also of interest the following day when the minister and I travelled to Renmark in the northern parts of my electorate. There we met with the Riverland wine grape and citrus growers, who know, unfortunately all too well, about drought. It was an interesting discussion regarding the government's relief package. With such informed groups, I know the minister enjoyed the positive feedback he received during his time in Barker. I was very pleased to help facilitate these discussions because I think it is important that primary producers in my electorate know that Australia has a federal agriculture minister who knows his way around a set of cattle yards and is at ease surrounded by farmers. What a welcome change it is to those of us in rural Australia with an interest in farming that we have a minister who is actually passionate about agriculture. The feedback we received on our tour was positive. Just as encouraging has been the ongoing discussion that I have been having with primary producers in Barker about the government relief package.

Farming families and industry groups are grateful that the federal government is genuinely committed to ensuring regional communities are not    abandoned at this time of crisis. I, too, am grateful that our Prime Minister and Minister for Agriculture have put a suite of measures on the table which offer an updated financial, social and mental health support framework for those in greatest need. I echo the sentiments of the National Farmers' Federation President, Brett Finlay, who I understand was in the building earlier today. He has said that the government's relief package announced demonstrates that the coalition government is listening to the farming community. I think Mr Finlay was spot-on when he described the package as being both fiscally responsible and considerate of circumstances suffered by rural communities in many parts of Australia. I also concur with Mr Finlay's commendation of the minister for his continued efforts as a champion for Australian agriculture.

I believe this bill is the cornerstone of the coalition's commitment to supporting family families through difficult times and investing in the growth of a profitable and globally competitive agricultural sector. This is important because, as others have said in this place, it will rain again; and, when it does, we need to be ready to take advantage of that situation.

That is why I am proud to be a member of the coalition government and proud that we have introduced this bill into the parliament. This bill reinforces the federal government's support for the Australian food and fibre producers and, more broadly, for our nation's rural and regional economies. As such, I commend it to the House.

Scott Buchholz (Wright, Liberal Party) Share this | Link to this | Hansard source

It is with great pleasure that I rise to speak on the Farm Household Support Bill 2014 and Farm Household Support (Consequential and Transitional Provisions) Bill 2014 this evening in the chamber. Before I speak directly to the bill, it would be remiss of me not to take charge of some of the comments that came from the other side of the House during this debate.

Members opposite took the opportunity to burnish their credentials, claiming that pricing carbon was a good thing for our farming sector. I was speaking with an irrigator only last Saturday, and when he opened his power bill he was physically sick as he looked at the escalating cost of him doing business in the agriculture sector. Can you imagine what stress that has on a family's mindset? Can you imagine what pressure it puts on the family budget? I challenge anyone in this place to think of the last time they opened a bill and their immediate response was to be violently ill. To come to this place and claim that pricing carbon is a wonderful aspiration for the agriculture sector is fundamentally flawed. It is playing a crippling role.

We heard comments from the crossbench that it was ridiculous that Australia could be the food bowl for Asia. Members from the crossbench, who have spent more than 27 years in parliament, whether it be in state parliament or in this place, are part of the problem. It is those who sit on the crossbench who decide. Go back and look at their years of experience. When they came to the parliament, state or federal, farm input costs were up to six times lower. When those members of the crossbench came in here and said there was not a future in agriculture and scoffed at the coalition when we said that there was, the average cattle property in his electorate would have had 10 full-time workers on it. Today in his electorate, the average workforce on a property would be mum, dad and the odd contractor that would come in on an annual basis.

Input costs are crippling our sector, whether it be through petroleum costs, labour costs or seed costs. We say that we are a smart nation, but a John Deere harvester in America is $400,000. We were at parity with the US dollar not too long ago, and the exact same machine here was $800,000. Why? It is the crossbenchers who have overseen that and then dared to come in and criticise the coalition when we came in and put up packages to assist this sector.

I am proud of the sector in my electorate. We have the Lockyer Valley with Gatton, Laidley and Forest Hill. In addition we have Beaudesert, the Fassifern Valley with Boonah, Harrisville and Peak Crossing, and, to the south-east, Canungra and Beechmont. Each one of those communities relies heavily on the success of the agriculture sector, whether it be beef, dairy or horticulture. When one of my farmers is doing well, they are in town buying new stock or product.

A typical farming business in my electorate is a family business by the name of Dovers and Son. They are third generation and openly saying it is as tough as they have ever seen. And it is tough. We were affected by the live cattle export trade debacle that we saw introduced by the other side of the House and supported by the Greens; but, as a result, when those northern cattle no longer had an export market, they were forced into our southern markets, so our traditional prices that we would have got took a beating.

Our dairy industry is on its knees at the hands of the duopolies of the processors that they sell their milk to. When you go to the processors and put them under the pump, they will make it absolutely clear that the pressure is being screwed on them on the back of dollar-milk processing. In Queensland I now have less than 500 dairy farmers when 10 years ago there were 2,500. It is a bleak future. I have stood in this place and spoken about the dairy industry many times before, saying that I cannot fix this industry with a single piece of legislation for a mandatory code of conduct. There needs to be in the dairy sector in my electorate a muscling up on the processors and demanding a better price for the product at the farm gate. The retailers understand the value of the price of milk; they strategically place it at the back of the store so that you have to walk past all their other product lines to go and get it. They understand the value of milk. They use it as a cost leader to get people in the door so they can take advantage of the market.

I have the seventh-most-fertile valley in the world in the Lockyer Valley, which is situated right next door to the Fassifern Valley. The Lockyer Valley produce is sent to vegetable markets in all major cities and contributes around $250 million worth of product each year just from that area. Next-door, still within my electorate, the Scenic Rim is dominated by agriculture, contributing about $196 million and $13.6 million of the gross regional product of the Scenic Rim. Agriculture is also the largest employer within the Scenic Rim, employing a total of about 1,400 people, or 13.7 per cent of the region's workforce.

The thing that unites my agricultural sector, whether it be dairy, beef or horticulture, is rising debt. A quick synopsis: roughly, if you bought a place in the electorate about 10 years ago you would have paid around $5 million for it. Your debt ratio would have always been skewed at around 50 per cent. Over the last 10 years, the value of your property would have gone from $5 million to $10,000,000. So as a result, your debt ratio at 50 per cent went from $2½ million to $5 million as the price escalated. You have a debt of $5 million on a valuation of $10 million.

In recent years, on the back of the drought and the poor policy decisions by the previous government, the value of land has come back. We have properties now that were worth $10 million but, if pushed for a fire sale, today they would be worth around $6 million—but they are still carrying a $5 million debt. So they are way outside their 50 per cent loan ratio and that is why we as a government are here today introducing the Farm Household Support Bill 2014. We are doing our share in lifting up and trying to help this sector back to prosperity.

There is a responsibility for our banks, who rode the wave of prosperity, who saw the opportunity to lend to the market, who saw the opportunity with rising valuations and who saw that it was a safe bet with security if things went sour, that their money would be secure. So I say that there is a role for our major banks in being part of the solution. There is a future in the agricultural sector in Australia; there is a future in the dairy industry, there is a future in the beef industry and there is a future in the horticulture industry. If you listen to the crossbenchers they will tell you that there is not. Evidence to support my case, that there is a future in this sector, is that when a place worth over $200 million wants to get sold there is a kilometre-long line of international buyers standing and waiting to come to Australia to invest into this sector because they see the future benefit. Why do they see the future benefit and why do they see Australia as a safe bet to invest in? Because we are the smartest in the world. We are the most efficient farmers in the world. We have the most initiative, and we are the most intuitive farmers in the world. We will continue to be because we have to be.

I have a local family in the dairy industry, the Dennis family. They said, 'No more, I am not accepting the processors price.' They pulled a couple of million dollars and did a partnership deal with some friends, some family and some banks. They set up their own bottling plant and they are now distributing their milk, Scenic Rim 4Real Milk brand, to over 200 outlets in the south-east corner. That is the initiative. That is the intuition that inspires us as a nation—that singular type of operator.

As a government, the producers are not looking to us for a handout. They just want us to get out of their way. These are our people; the agriculture sector are our people. Just as the unions are linked at the hip to the Australian Labor Party, the agriculture sector are our people. When we cut ourselves they bleed. The agricultural sector believes in the same political ideologies of freedom, of free market, the values of family and the values of Christianity. These people are the true quintessentials who have made Australia what it is. They need to be looked after—they are our future.

At lunch on Saturday, again, I was disappointed when I heard a grown man tell me that he is spending nearly $20,000 a week on feed to keep his stock alive at his property west of Longreach. He has three kids coming through and I said, 'Do you want the kids to take over the place?' He said, 'Not a chance. This is killing me. There is no way I want my kids to do that.' And he said, 'Do you know what? However tough it is, I will get out of this. I will be better for it.' Then he said, 'I know it is not the right thing. I do not want to push my kids into it. But I know that they will live here. My parents lived here. I lived here. My kids will live on this place.'

There is a sense of pride in the bush. There is a sense of achievement. As a coalition government we need to lock arms with this sector and ride with them for the next 10 years, in conjunction with the banks; by writing good policy and by making sure that we do everything in our power to reduce these horrific input costs. Every day that we have breath in ourselves, we should remember that there are people out there at the moment opening their energy bills and who are being physically sick—ill—because they have no idea how they are going to meet those costs. I thank you for your indulgence, and I commend the bill.

Angus Taylor (Hume, Liberal Party) Share this | Link to this | Hansard source

It is a great privilege to speak on the Farm Household Support (Consequential and Transitional Provisions) Bill 2014 today. Almost 10 per cent of my electorate work directly in agriculture, and many more work indirectly in the sector, so any legislation impacting on agriculture is of great interest to me. It is also of interest to me as a fifth-generation farmer myself.

A traditional feature of agriculture, and indeed small business more generally, is that the household and the business are often one and the same. To understand how we might best help farm households we need to talk first about farm businesses and how we might support them in the coming years.

It is unfortunate that the last government never understood agriculture, the opportunities it presents and the policy framework we need to put in place to make it succeed. We saw a raft of policy failures, and more about that in a moment. On this side of the House we understand—and many other speakers who have come before me have said the same thing—that agriculture stands on the edge of the greatest opportunity we have seen in decades and perhaps even centuries. Many seem to not understand this point. Yes, this opportunity is not getting through to the bottom line for many farmers for reasons that I will explain, but some other members, like the member for Kennedy, need to get out a bit more into our export markets to see what is really happening out there. These are strong words, but let me explain.

In 2005 I began work on a project in Western Australia. I was working with the largest iron ore producer in Australia trying to understand the impact that Asian demand was having and was going to have on its business. The results of the work were absolutely staggering. China had suddenly realised that self-sufficiency in iron ore was no longer realistic. Its thirst for our exports that followed was growing by the day and prices began their extraordinary journey from $20 a tonne to $200 a tonne. We talk now about how terrible it is that the iron ore price has got to $100 a tonne, but it is still five times higher than it was before the Chinese surge began. Meanwhile it became clear in this case that a business producing just over 100 million tonnes a year could be producing over 300 million tonnes in 10 years time. Most of the management team of this organisation fell over laughing, but the prediction proved correct.

Then in 2008 many, including me, began to apply the same approach to understand agricultural demand. The results were similarly staggering. Not only would population drive growth in demand for our food and fibre but far more importantly rising income would change diets in the most fundamental ways. As people get wealthier their calorie consumption rises—sometimes to their great regret—and, more importantly, the make-up of those calories changes too. As we get wealthier we eat fewer carbohydrates and more proteins, fruit, vegetables, oils and sugars. That in itself is interesting, but the story gets better for our farmers.

The land and water required for those calories is increasing at a remarkable pace as more and more people enter the global middle class and as the land and water requirements for more intensive proteins increase. To put this in perspective: two-thirds of the growth in the world is now in poorer, developing countries, as against just one-third a decade ago. So where is that land and water coming from to meet this need? The clear answer is: nowhere. For all practical purposes there is no new land and water to access and we will probably lose a lot of it to agriculture in the coming years. So the problem can be solved only by producing more with less—higher productivity—and not just more of anything but more of the right foods and the right fibre. Oilseeds, fresh fruit and veg, proteins and even sugar are the foods that will see the greatest gains.

Already this is having a big impact on global prices for many products. In the summer season just passed we saw extraordinary prices for fresh fruit and veg in countries to our north. They are prices that we are not yet accessing but they are extraordinary prices and markets nonetheless. Global dairy prices, not local ones, have reached new highs in recent years and oilseeds are being imported into China at unprecedented rates. The global markets for lamb and even beef have never looked so good, despite what is happening locally. Despite all this good news, only last week I hosted a forum for farmers in Goulburn and heard about the continuing cost-price squeeze that our farmers face.

So with all this good news why aren't we seeing greater farm profitability and greater farm prosperity? The answer is sobering. For a start, our competitiveness has suffered badly from a high dollar that has been exacerbated by extraordinary public spending in recent years. Any resource economist will tell you that the first thing you should do when you have a resources boom is save government money to take pressure off interest rates and take pressure off the currency, but our Treasurer at the time, the member for Lilley, decided to run a grand experiment by doing the exact opposite and spending money as fast as he could. At the end of the day who can stand between the Labor Party and a wasteful public spending agenda?

But the problem was worse. When a great opportunity in the marketplace presents itself, the key is to get access to new markets. So the government did the opposite again. They started shutting down export markets. The most successful agricultural market in the last 20 years was the live export market. The former government, in its infinite wisdom, decided to shut the market down. We have to remember that, despite what the member for Kennedy would have us believe, the bulk of our agricultural sectors are export focused and have been for almost 200 years. To make matters worse the last government made no progress on accessing new valuable markets. While the Kiwis managed to get a free trade agreement with China, which is now powering their economy through dairy exports, we got nothing. That is why we announced within months of getting into government an agreement with Korea and why we will continue to work hard on Japan and, perhaps most importantly, China.

But agriculture needs more than just markets; it needs secure access to water and land. The Labor Party got to work on this one with its appalling Murray-Darling Basin Plan. Instead of looking at innovations to save water and use it better for environmental purposes, the ALP went for the lazy answer of taking water from agriculture. Meanwhile, agricultural education and R&D have suffered badly. We saw a reallocation of money to green research and education. The focus was taken away from productivity. But I guess when you are married to the Greens that is what you do. Farm extension services, the lifeblood of farm productivity, have gone the same way, with a shift from a productivity focus to an environmental focus. All farmers understand sustainability and understand that profitability is a prerequisite for sustainability. Throughout all of this, our supply chains had suffered from a policy vacuum. We stepped in to deal with the proposed Archer Daniels Midland purchase because there is limited competition in our grain ports and an ineffective regulatory framework. Grain is not the only industry where this is true. We know there are problems to solve in the sugar industry and in parts of the meat and dairy industries.

Farm finance has also suffered from a policy vacuum. As farm debt levels climbed from $30 billion to over $70 billion, there was no debate in this country about how we would finance the next generation of farmers into this wonderful industry. These younger farmers should not just be the sons and daughters of current landowners. Instead, we want to follow the New Zealand example of finding ways to bring new blood into our industries. At the end of the day, the owner-operator, the family farm, will remain the heart of our farming industries; but that owner-operator will need to have its business partners to succeed.

Into this context, the coalition is determined to take advantage of the extraordinary opportunities we currently face in agriculture, opportunities that others dismiss. We are re-establishing the live export trade. We are opening up new markets in Asia, both through increased market access and also through enhanced biosecurity. We are focusing on delivering more water in the Murray-Darling Basin for both agriculture and the environment. We are putting more money into R&D. We are focused on helping farmers to reduce their costs through reduced energy prices, reduced red tape and less government borrowings to take pressure off interest rates and our currency. Our agricultural white paper is the first serious look at the broader policy framework for agriculture for many years. The paper will look hard at many of the issues I have already talked about, including agricultural finance, education, R&D and supply chains.

But we also need to support those suffering from the ravages of years of poor policy combined with harsh seasons. Coalition policy will never focus on propping up failing businesses, but it will focus on helping out households facing impossible circumstances. My first significant memories of drought were in the early 1980s. When lying on the ground, I could shoot rabbits hundreds of metres away without a blade of grass between me and the rabbit. That was bad news for the rabbit but worse news for us as farmers. The stress on families in these periods of drought is enormous, and I saw it in my own family. I prayed for rain constantly, if only to relieve those family pressures, let alone the business pressures.

I am pleased that both sides of the House support this legislation. I acknowledge the commitment of the member for Hunter for supporting many of our agricultural policies. He understands the flaws of past policies, and the serious need to move away from the mistakes of recent years. There are many aspects of this legislation before the House that show a deep insight into modern agriculture, farming businesses and farm households. We understand that the asset threshold that would trigger this assistance needs to be relatively high, and exclude the family home. That is why we have set the asset trigger at over $2.5 million and rising with the CPI. Selling down a farm business in a drought is a disastrous financial outcome, and a policy that forces such a sale would be poor policy indeed. We also recognise that off-farm income is often used to keep farm businesses going, but we should not discriminate against those who are earning that off-farm income. The legislation recognises this.

While my electorate is not suffering from drought in the way that many other regions are, there are areas of great hardship. This legislation recognises that farmers can face this hardship, even in areas that are not in what we might traditionally call drought-declared. Our agricultural policy is focused on helping farmers to be self-reliant, including in drought. Farmers want their businesses to succeed without government support. That is our focus, and the focus of this legislation. Only when self-reliance is impossible should the government step in. That is also the focus of this legislation.

This is an extraordinary time for agriculture. In 1788, when Europeans first arrived in Australia, they could not have known that in a few short decades this new country would become an agricultural powerhouse, building enormous prosperity on the back of exports to England. We currently face an opportunity of similar magnitude. We will not get there unless we provide the right policy framework and the right support to our farmers, in their times of greatest need. I commend this legislation to the House.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Thank you very much for the opportunity to speak on the Farm Household Support (Consequential and Transitional Provisions) Bill 2014. This becomes the second iteration of a drought policy. I took the first part through the cabinet and the parliament at the end of last year. That allowed the movement of tens of millions of dollars into drought affected areas and also allocated $10 million towards water infrastructure. At that point, we hoped and prayed that we would get rain and the issues would be alleviated. Of course, that was not the case. This brought us to the position where we had the second iteration, of which this is a crucial part.

Prior to this, we had the transitional farm family payment. The trouble with that transitional farm family payment was that it was not accessible to enough people to deal with their financial trauma. In many instances we had people who had no access to money whatsoever, none. They were actually ruled out from having access to social security by reason of the asset test. When the asset test comes to a position of $1.5 million and you have a property worth $3 million, which is not unusual nowadays, with debts of $1 million without any real desire for the bank to go any further than that—they actually were outside the assets test. What does this mean? The differentiation for them is that we had houses with no money going into them at all. They did not get Newstart; they were not allowed to get Newstart. They had no access to income from the farm because they were in drought. They could not just close the gate and walk out the door because you are actually bound by law for the maintenance of your stock and other vital components of the farm.

No matter which side of the chamber you are on and who you are, there is something inside you that says something has to happen, that this is not right; that our fellow Australians and fellow Australian families should not be put in this sort of condition. When you get to an area you can see that sort of pall of depression and darkness that falls over people as they say: 'Well I cannot see a way out. I cannot even clean up the accounts in town. I cannot go to town because I am a bad debt. If I go to town, how do I pay for my fuel? How do I clear the chemist account? How do I deal with all these other things about which people say, 'That doesn't happen in Australia'. Well it does. There is no more vital sign of misery in our nation that we refuse to see than rural misery, where people live in a diminished condition. Not only that, these people live in a diminished condition miles away from the benevolence of the government that is apparent in the multiple hospitals and schools that you would see in larger urban settings.

I said that at the start because it is very important that people clearly identify the difference between doing it tough in the country and doing it tough in other parts. I am not saying for one moment that there are not people in the western suburbs of the major cities, or in other areas, who are doing it tough as well. This is a particularly cruel form where not only are you without your regular income stream, which is tenuous on many occasions by reason of the fact that is it is related to the vagaries of the weather, but also you are taken away from any social security settings. It is vitally important that we immediately change this.

I commend the support of the coalition and the Prime Minister and the support of the opposition in saying that, on this occasion, people on either side of the political divide are not going to let this human misery continue. So what this legislation allows people to take the limit from 1.5 to 2.55 million and their house is exempt as well. Exempting your house, your primary domicile, probably gets you close to a $3 million net asset limit. If you go away contract harvesting, if you go away working on the road or if you go doing some work in one of the mines, it allows you to earn up to $80,000, provided that your interest bill is bigger than that because we know that, when the money turns up, the banks will just hoover it up and send it straight off to fix them up. At least, it allows you some sort of mechanism to earn some external income. This allows off-farm assets for a couple, for partners, of about $280,000 as well. All in all, it is a good outcome.

I have had some people say it was rushed. The member for Moreton said it was rushed. It was not actually. He should be aware of his own government's position. The first time we started reviewing this was in 2008. On this issue, we are bringing forward and adjusting the settings, but the overall scheme is something that we have been looking at for some time. It is part of a process of dealing with the issues of drought into the future. We will have other settings in other parts, to which we wish to ensure people will get access. We will make sure that people will get access to $280 million at four per cent, or a million dollars or 50 per cent of the facility, whichever is the lesser, so that people can have access to money. It is not part of these bills but, in similar settings, is part of the drought package. That gives people access to money to replant, to restock, to try to get cash flows moving again.

I will be happy to say the interim farm household allowance is currently working under executive orders. What we are talking about is the settings as of 1 July. I suppose people are wondering, if we are talking about this legislation now, how on earth are people are getting access to it? It is happening under executive orders. I want to remind people that we already have about 83 claims that are true. So 83 families now have access to this scheme, which is uncapped. Whoever is out there in need and is listening, this scheme is uncapped. You will get access to it if you fit the criteria. We are seeing right now that people are doing precisely that—they are fitting the criteria. Before with the interim farm family payment, when I went to some towns only one person in the whole town it. It was not really ticking the box.

We have also had some other discussions. With the greatest respect, there was one where the member for Hunter asked for clarification about the costs associated with the farm household allowance and the $99.4 million that was agreed to by the Labor government in 20013-14 as the cost of the allowance over the forward estimates. This included $37.3 million for the Department of Human Services to administer the allowance. Of this 30 million was set aside in 2013-14 to build a dedicated IT system to support the payment and for case management of the allowance. Again, this was the setting put in place by the former Labor government. The member for Hotham brought up that her husband's family was associated with the dairy industry and noted that the scoping meetings—they are not happening any more—would bring an end to civilisation as we know it. We will still have as required—

Anthony Albanese (Grayndler, Australian Labor Party, Shadow Minister for Infrastructure and Transport) Share this | Link to this | Hansard source

Move on, Senator!

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

It is good to see the member for Grayndler, from the large rural seat of Grayndler! I noticed that St Mary's Cathedral is right next to Hyde Park.

Anthony Albanese (Grayndler, Australian Labor Party, Shadow Minister for Infrastructure and Transport) Share this | Link to this | Hansard source

Libya Hill—say thank you and move on, Senator!

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

Lucky we got the money back for that.

Anthony Albanese (Grayndler, Australian Labor Party, Shadow Minister for Infrastructure and Transport) Share this | Link to this | Hansard source

Just say thank you and move on.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

I would say thank you if you had left any money in the bank, but you did not; we had to go and find it.

Anthony Albanese (Grayndler, Australian Labor Party, Shadow Minister for Infrastructure and Transport) Share this | Link to this | Hansard source

That is nonsense and you know.

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

You should ask me more questions. Why don't you ask me some more questions? It was very important that we recognised that we can actually have meetings, if people want them. We will be having meetings from time to time and I envisage that we will be having a meeting in the very near future to deal with, among other things, working out a national approach for fruit fly.

Agriculture in Australia is vitally important. There is no better example than what happened in January. This nation thought we were going to have a $100 million loss for the month but we ended up with a $1.4 billion surplus. The member for Hunter, who is sitting beside the member for Grayndler, will be able to tell him exactly where that came from. Predominantly it was driven by agriculture. This goes to show that agriculture puts money on the table to pay its way. How did we get that money on the table? We harvested $17.2 million worth of wheat in Western Australia—we got in excess of six million tonnes of wheat onto boats—and we had the live cattle trade, with those terrible people in the live cattle trade putting all that cattle onto boats, getting paid for it and helping our nation get back into profit. We also had all those terrible people in the live sheep trade, getting paid for putting sheep on boats and bringing money back into the country. It is great when we get these trades going again because that is how we turn a buck. When you are making a buck you do not need the Farm Household Support Bill, because you are making money. But, if you have got a drought and you are doing it tough, these are the sorts of policy settings you need. Our minds are always directed towards how we can turn a profit and how we can take the agricultural future of our nation forward. That is why I am also very encouraged by the support we are getting for the white paper.

The white paper is going to be a seminal document. It is going to increase the capacity of all those people throughout the agricultural sector to have their say in where our nation is going. It will make sure those people will be able to make their contribution on how we get a fair return back to the farm gate; how we can get a better return back to the mums and dads, back to the kitchen table, back to the people who are putting the cattle on the boats and paying their way in our nation, back to the people putting the wheat on the boats and paying their way in our nation, back to the people who are working under the belief that, even with the vagaries of the weather, they are doing the right and proper thing by creating the food and creating the fibre which feeds people and which clothes people—I cannot think of a more honourable life; that would have to be one of the best. These people deserve our support and I hope that will stem from the white paper. I think that this hope is not in vain. There will be a good sense of bipartisanship as we try to make sure that we create settings ensuring that long after I have gone, the member for Hunter has gone and other people have left there is a document that can be taken forward—

Anthony Albanese (Grayndler, Australian Labor Party, Shadow Minister for Infrastructure and Transport) Share this | Link to this | Hansard source

Who do you reckon will be here the longest?

Barnaby Joyce (New England, National Party, Minister for Agriculture) Share this | Link to this | Hansard source

I do not know. The way I am going, probably you. We will have a document that can be taken forward. It is something similar to a defence policy, so people know roughly where you are coming from and how it is going to work. I know that this is basically non-contro apart from the expected couple of jibes that you always get on an issue like this. We have something later on that is going to be slightly more contro—we will see how it goes—and that concerns the re-registration of chemicals. Maybe that will liven the place up a bit. I thank those in the chamber for their attention.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.