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

I rise tonight to say some kind words about and pay tribute to Peter Dutton, Minister for Revenue and Assistant Treasurer, on his initiative with managed investment schemes. It has taken considerable courage and considerable intelligence to understand exactly the issues involved here. He has made a very intelligent commitment to doing what is the right thing. I pay the minister a tribute—it is something I very rarely do in this place—because I think he is well deserving of the highest of praise. If he has received criticism from some of his colleagues, then all the more power to him. If there is something worth doing, then I very much doubt it is really worth doing if there is not some opposition—and considerable opposition—to it.

The first time I ran across managed investment schemes was with olive trees. I was very supportive of the projects and I thought there was a good aspect to the whole initiative, as we did not have many olive trees in Australia at the time. However, my next experience was with mango plantations.

Mr Speaker, you must understand what happens here. John Gambino is a leading mango grower in North Queensland and it cost him $100 per tree by the time he had planted it and put irrigation and everything else in. So he had a capital outlay to service of $100 per tree. When these giant mango plantations went in, they probably did it for $120 per tree, but of course they went broke and the receiver sold them up for 50c in the dollar, so it was resold at $60 a tree. So the new owner only had to service a capital outlay of $60 per tree.

Corporate farming does not work and of course the corporate farm collapsed again. Now they were sold up for 50c in the dollar. The situation now is that all they have to do is service a capital outlay of $30 per tree whereas John Gambino, a hard-working pioneer of the mango industry in Northern Australia, has to service a capital outlay of $100 per tree still because he is an honest, decent, hard-working Australian farmer. The motivation of people investing in managed funds is not because they are farmers but because they want to avoid paying taxation. That is their incentive.

A person who I know very well told me that his accountant had told him that he had to borrow $300,000 to invest in a managed investment scheme. He rang me up and I said, ‘Don’t be ridiculous.’ One of the ex-heads of one of the major accounting firms in Brisbane is on record as saying that not a single one of these schemes to his knowledge has returned any capital outlay to the investor. I advised this person accordingly, and the person said: ‘Oh, yes, but some companies guarantee that after nine years they will return your capital. It is a guarantee in writing.’ I said: ‘Well, that is if the company is there. I do not know of any of these companies that have lasted nine years.’ He checked it out and he said, ‘Jeez, you were right,’ and he did not make the investment.

Unfortunately, an awful lot of people in Australia have and they have lost a great deal of money. That is their choice. That is the free market system. But what is not fair is Johnny Gambino having to compete against somebody that now has a tree capitalised at $30 when he has a tree that is capitalised at $100. What possible hope has he got of competing against that situation? He has no hope.

Fabio and Judy Petrusa founded the tea-tree industry. Willis and Kathy Fabris and many other families at Dimbulah followed in this pioneering industry. A company came in and projected that they were going to get the market price of $38 a kilo and of course the price they did get was $12 a kilo. They flooded the market and they ended up with only $12 a kilo, but all of these hardworking, decent farmers went down with them. I see Minister Truss at the table laughing. I think he finds it very humorous what happened to these farmers in Australia. I find it very curious that he is laughing at it, but I would not expect much more from the honourable member. We know his reputation. I do not think he is game to set foot in this area.

David Fawcett (Wakefield, Liberal Party) Share this | Link to this | Hansard source

Steady on.

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

No, I will not steady on. I would not want to be provoked on the issue. I could give examples. (Time expired)