Dan Tehan (Wannon, Liberal Party) Share this | Hansard source

It is an absolute delight to stand here this morning after the budget was delivered last night: a budget which is in the national interest, a budget which provides hope and a future for our children, a budget which did not burden them with debt, a budget which provided an honest path back to surplus. We are here this morning looking at the Tax Laws Amendment (2014 Measures No. 1) Bill 2014 with a great sense of pride and understanding of the job we now face as a government of making sure we implement and deliver on the budget, which was so excellency delivered by the Treasurer last night.

This is an important bill. Obviously it comes in two parts. The first schedule refers to the farm management deposits scheme, which has become the most effective drought-proofing financial measure that farmers have today. The second schedule allows self-assessment in GST overpayment refunds. This was introduced by the previous government. It allows individuals to self-assess their tax refunds due on overpayments of GST. It will have an expected cost of $4 million over the forward estimates, but it is something that lapsed at the last election and something that this government is happy to move ahead, with the support of the opposition.

When it comes to the farm management deposits scheme, there is a little bit more detail on what is being proposed. I must say that what is being proposed is a simplification and also takes away a lot of the unnecessary regulation which farmers are burdened with under the current system. The idea of the farm management deposits scheme is that it teaches self-reliance, and it teaches self-reliance to our farming sector. This is something which comes naturally to farmers because they are used to being self-reliant. In enhancing this scheme in this chamber today, we are doing farmers credit and we are also doing the nation credit in recognising what farmers contribute to this nation and what they will continue to contribute to this nation.

I stand here proudly in this parliament as the representative of the electorate of Wannon. Wannon contributes significantly to our agricultural sector. We produce more wool than any other area in the country; we produce more lamb and sheep meat; we produce more dairy products than any other electorate in the country. I stand here proudly on behalf of my electorate in saying that the agricultural sector contributes to this nation, and my electorate does so as well. It is why we need to help our farmers. They have to run businesses, but, because these businesses can be hit by events outside of their control, farmers need the tools to be able to deal with those events. Through the Farm Management Deposits scheme, we are giving them the tools to deal with such events.

I saw firsthand the difficulties that farmers can have when they are hit by unseasonal conditions. In the summer before last, the dairy sector in my electorate was hit by unseasonably dry conditions. That had untold ramifications for those dairy farmers because, particularly when it came to purchasing grain to feed their dairy cattle, it was costing them up to $10,000, $20,000 or, in some cases, $30,000 a month to buy the grain to keep those cattle fed so that they could keep producing milk and keep an income flowing. The Farm Management Deposits scheme enables farmers to prepare for those types of occurrences.

We also have to be mindful—and I must say, once again, both sides have done this in a bipartisan way—that there are also those circumstances, such as if we get 10-year droughts or even droughts of longer periods, when Farm Management Deposits schemes will not be enough. This is where we have stepped in with the Farm Finance package. It is something which is being rolled out, especially in Queensland and New South Wales at the moment, to help in those situations where farmers are not just dealing with one, two or three years of bad seasons but looking at prolonged periods. The Farm Finance package has shown that there is an understanding and a realisation in this place that there are circumstances that our farmers will face when, even if they are prepared through having put savings away for those non-rainy days, drought and severe drought will hit and there will be a need for us to say, 'We understand the contribution you make to the nation and the income that you provide us. Therefore, we, as government, need to be able to step in and give you the assistance as necessary.'

What do the measures being introduced today mean? The first measure is an increased non-primary production threshold. The first enhancement will increase the non-primary production income threshold from $65,000 to $100,000. Therefore, the off-farm component—that income test—increases from $65,000 to $100,000. This is a sensible recognition of how more and more farmers, or their partners, are earning off-farm income. It is a sensible recognition of how important that off-farm income is to the business and how the farming business is planned. Therefore, it is a very sensible reflection of where current farming practice is at.

The second measure is around the consolidation of accounts. This will enable farmers with multiple FMD accounts to consolidate them without affecting their ability to access them when needed. Under the current arrangement, it is common for farmers to hold FMDs in several accounts with the same or different institutions. Obviously, being sensible managers of their money, they have gone looking around for the best deals that they can get from their banks, and that does not necessarily mean that they go to the one bank and have the one account. What we are doing now is making it easier for those farmers so that they will not face tax implications if they withdraw any funds from an account within the following 12 months. This is another very practical and sensible approach to doing this.

We are also taking measures around the unclaimed moneys exemption. We all remember that, because they got the budget into such a precarious state, the previous government had to go about trying to find measures to put revenue back into government coffers. In one of the ways that they came up with to do this, where money lay idle in accounts—it used to be that, if it was there for seven years, the Commonwealth would become the owner of that money—the previous government reduced this. They reduced it for no sensible policy reason. It was just, basically, a pure revenue grab. This obviously has implications for the Farm Management Deposits scheme, because farmers, in many instances, are putting this money into those accounts and leaving it there. The new measures, basically, exempt the Farm Management Deposits scheme from the unclaimed moneys exemption, which is another practical and sensible response to some of the measures that had to be put in place by the previous government to fix the catastrophe which was their management of money. Another aspect of this program is that it delivers on the commitment made by the Australian government through the Intergovernmental Agreement on National Drought Program Reform. This commitment will ensure farmers have access to a range of measures to build their resilience and provide effective risk management tools. This fits with the agreement between the Commonwealth and the states on how we should prepare for drought and how we can help farmers deal with those severe one in 10 or sometimes one in 20 events.

This is good sensible law-making. That is probably the best way to describe it. It is terrific to see that both sides can come together and put together proposals like this which will be of benefit to our agricultural sector. It will reduce red tape and it will make it easier for farmers to plan for their future. That is what the philosophy of this government is all about. We saw it last night in the budget that the Treasurer delivered. The budget was all about enabling families to plan for their futures and it was all about making sure that future generations would not be burdened by us trying to maintain our current living standards. Today's enhancing of tools for our farmers is all about that as well. We are saying to our farmers today that we want to make it easier for you and we want to give you the tools to plan for your future and plan for those non-rainy days, in a way that secures your future and the future of your children.

The amendments dealing with self-assessment of GST overpayment refund claims and farm management deposits obviously have the support of this side of the House. When it comes to the agricultural sector in particular I look forward to working with members both on this side and on the other side to make sure that we can secure the future of agriculture in this nation for the next 20 to 25 years. The agricultural sector is vital to our economy. It has been recognised by this government as a key pillar for our future economic growth. It is a sector which has the potential to continue to help grow employment in this nation. We continue to see value adding to our primary production, and more jobs will result if this can be sustained over the long term. The sector is also an incredible source of export income to this nation and, as everyone knows, export income means real jobs. This government will continue to pursue measures that will enhance our agricultural sector. We have seen it through free trade agreements that have been delivered and we will see it through the ones that will be delivered. They will provide future opportunities for us to grow the sector. In summary, I commend both of these tax law amendments to the House.

See this speech in context