Wednesday, 19 September 2018
Treasury Laws Amendment (Supporting Australian Farmers) Bill 2018; Second Reading
Labor is supporting the Treasury Laws Amendment (Supporting Australian Farmers) Bill 2018. However, I'm speaking in support of the second reading amendment that was moved by the member for Fenner, which really highlights the Abbott-Turnbull-Morrison government's lack of any long-term policy, planning and approach to assist primary producers in rural Australia facing drought conditions. This bill amends the Income Tax Assessment Act to allow primary producers to immediately deduct, rather than depreciate over three years, the cost of fodder storage assets such as silos and hay sheds used to store grain and other animal feed. This will assist primary producers by making it easier to invest in stockpile fodder. The measure applies to fodder storage assets used or installed, or ready for use or installation, on or after 19 August 2018. The measure has a fiscal impact of $75 million over the forward estimates.
Despite these measures, it's clear that there has been a lack of any long-term policy and planning to assist primary producers in rural Australia facing drought conditions by the Abbott, Turnbull and Morrison governments. New South Wales, the home state that I represent, is entirely in drought. Farmers are facing falling crops, short supplies of water and diminishing livestock feed. We've already heard from farmers who say that the government's slow response has been too little too late. Unfortunately, there's been no real planning by this government for drought conditions when we know—as we've heard from climate scientists and others—that we're going to face an increase in frequency and an increase in severity of drought conditions in Australia due to climate change.
The government has been on notice for some years now that, according to climate scientists, these conditions are going to worsen; but the government hasn't adequately planned for them and that's why many farmers are saying that this is too little too late. That's what happens when you have a policy vacuum and a failure of the hodgepodge, last-minute measures from the government. Drought policy shouldn't only be designed during a period of drought. It should be planned for during other periods to ensure that adequate planning has been done to cater for the fact that climate change is occurring in this country and that all of the evidence and all of the expert advice of climate scientists is that climate change is going to worsen the effects of drought and increase the frequency of drought in Australia.
We also need to ensure that the management of water resources is better planned for around the states, in terms of their provision of access to water resources through agreements with the Commonwealth government. Again, this is something that this government has a dismal record of planning for. Importantly, through measures such as what we're discussing today, our taxation arrangements and our system of deduction—particularly for the purchase of assets—need to be appropriate and meet the needs of farmers, ensuring that they can continue to operate and survive during drought conditions.
Unfortunately, this reactive approach to policy initiation by this government is all too common. We've seen this in terms of the financial services sector, which, again, has had a big effect on farmers. We've seen the rounds of evidence that have come through the banking royal commission and the effects that some bad decisions by banks have had on many farming families and businesses in the agricultural sector. Again, the royal commission was a knee-jerk reaction from this government. We should never forget that for 600-odd days, the Abbott-Turnbull-Morrison governments voted against a royal commission. That was when many farmers were saying that what was going on in their industry was at crisis levels and the government needed to initiate a royal commission. Many National Party senators, particularly Senator Williams, had been crying out for a royal commission for some years. Crisis shouldn't be the only catalyst for change when it comes to supporting Australian farmers.
Sadly, after the five years of policy inaction by the Turnbull and Morrison governments, we now have had four drought announcements within three months. Firstly, there was the increase in the farm household allowance payments from three years to four years, which is effective from 1 August 2018. Then, on 5 August, the government announced a $190 million package, claiming that it provided immediate additional financial support for farming families and their communities—although it didn't really, given that the additional funding didn't start flowing until 5 August. Time will tell how many farmers access the farm household allowance supplementary payment. It's possible that many farming families will miss out on the full $12,000 amount because the government insisted on splitting the payment and denying farmers the option of receiving a lump sum payment.
The minister then made no mention about increased funding for mental health support, yet last week the Prime Minister tweeted an extremely insensitive video claiming that drought was 'a necessary evil' and that it can help cut the bottom 10 per cent of people that 'probably shouldn't be there anyway'. That's not what struggling farmers need at this time of drought crisis. Labor have been asking the Prime Minister to apologise and remove this video for what we believe are insensitive remarks to people that are really battling and doing it tough at the moment.
On 19 August 2018, the then Prime Minister, Malcolm Turnbull, announced the appointment of Major General Stephen Day as the National Drought Coordinator. Interestingly, no mention was made on the appointment of the drought envoy position by Prime Minister Morrison, and we think that that's quite telling. The member for New England was clearly an answer to a question that farmers had never been asked. Unfortunately, when the member for New England was the agriculture minister there was a distinct lack of action and planning to deal with what was inevitably going to be another drought situation in Australia, given the advice of climate scientists. Of course, we also had the failed white paper, which was full of short-term initiatives, many of which were so poorly designed that they never saw the light of day. One of his first acts as Minister for Agriculture was to dismantle the SCoPI, the COAG council working on long-term drought reform measures.
When it comes to drought relief, farmers have not experienced any meaningful and long-term planning from the various iterations of this conservative government. The government has failed to deliver long-term policy and planning for primary producers and rural Australians facing drought conditions, including a failure to take mitigation and adaptation responses when it comes to climate change. We need to help more farmers better adapt to climate change. It's pleasing to see that many farmers are now on the front line of arguments for greater action for climate change, because those that work on the land probably understand better than all of us that the climate is changing, that it is having an effect on conditions for farming in this country and that we need to embrace best-practice regenerative farming methods to combat drought. The National Farmers' Federation support this approach, saying that real impacts of climate change will mean that drought and rain events could be more extreme and could be more frequent, yet the Prime Minister still won't say whether human-induced climate change is associated with the drought. He's saying he's not terribly interested in engaging with this crucial aspect of policy design for supporting Australian farmers.
Unfortunately, when it comes to drought, energy policy or electricity prices—which, again, have had a big impact on the profitability of farms and farming businesses—the government is willing to ignore the evidence. Their ideology overlooks the fact that, according to climate scientists, widespread and prolonged droughts like the millennium drought will occur more frequently in Australia. Researchers at the University of Melbourne and the Australian National University argue that droughts are getting worse compared to recent centuries and may be exacerbated by climate change. In particular, they say that recent shifts in rainfall variability are either unprecedented or very rare. If it's serious about supporting farmers, the Morrison government must institute some long-term planning around drought resilience and ensure that the agricultural sector can survive what are going to be increasingly frequent and more severe events. We need to be doing that planning with the states to ensure that it takes place at a coordinated national level and has the support of the states. The Morrison government must also take immediate action to restore the COAG drought policy reform process, respond to the review into the Intergovernmental Agreement on National Drought Program Reform and update the parliament on the progress of the new agreement.
We can't, as a nation, continue to ignore the fact that, unfortunately, according to climate scientists, drought is going to happen more frequently and more severely in this country. If this parliament have the interests of the livelihoods of Australian farmers and their families in mind—those that toil and work on the land year in, year out—then we need to make sure that we are properly planning to mitigate the effects of climate change and that we're working with state governments and local governments to ensure that we have better processes in place to mitigate those effects. That is what was being approached through the COAG process. It's disappointing that this government stopped that collaborative approach, and has really put its head in the sand about the effects of climate change that we see in their approach to energy policy and electricity prices. It's been five years since this government was elected, and they still don't have a policy on energy prices in this country. That's simply not good enough.