John Forrest (Mallee, National Party, Shadow Parliamentary Secretary for Regional Development) Share this | Link to this | Hansard source

The grievance debate provides an opportunity for a member of the House of Representatives to advise the House of the state of their division. Grievance debate is an appropriate name because there is a great deal of grief in the federal division of Mallee, all of it to do with the lack of rainfall, either within the region itself or in the upper catchments of the rivers that supply the region with water. There are three distinctive regions of Mallee. In the south there are the Wimmera and Western districts, which predominantly produce grain and livestock. They centre around agriculture and primary production, which is the business activity of the whole region. There is also some horticulture, centred around wildflowers and olives. Further north of that is the dryland Mallee region, which predominantly produces grain, with some livestock. Then there is the Murray Valley, all the way from Leitchville in the east to the South Australian border, passing great cities like Swan Hill and Mildura. All of those regions have been drought declared and in exceptional circumstances for three years, now going on four years.

There has been bitter disappointment after autumn starting rains undermined confidence in the grain-growing areas. You have to admire the resilient, determined primary producers of Mallee. They went out and borrowed yet again from their banks to have another go, after their sixth year of depressed returns. Sadly, we did not see in winter the finishing rainfall so badly needed nor have we seen it in spring. In fact, extreme hot weather, with temperatures nudging 30 degrees Celsius, has just destroyed the hopes and aspirations of those in the dry land grain-growing regions. They are beside themselves with anxiety and worry.

Added to that is this. Along the northern boundary, which follows the state boundary, the Murray River, is the Murray Valley region. It produces dairy in the east and a whole variety of horticulture all the way to the South Australian border. I will focus on the prognosis for horticulture. The conditions that the determined and resilient people of Mallee are confronted with now are appalling. Currently in Victoria high-reliability irrigators, who are principally horticulturalists, have only 13 per cent of their water entitlement—and this is following last year, when they barely received half of their water entitlement. This is an entitlement they pay for and yet, because of the dire circumstances of run-off in the upper catchments in those dams that supply the valuable water of the Murray-Darling Basin, they are currently on only 13 per cent. They do not have the financial resources to compete yet again, as they did last year, in the water markets to buy precious water this summer. The weather in the Murray Valley this week has been hot and windy. There have been terrible, hot spring days. Yesterday it was 31 degrees. This increases the demand for plant moisture at a time of the year when early season moisture stress can adversely impact on the final crop yields.

Already, due to the river drought, close to 30 per cent of citrus crops and vineyards in fine soldier settlement districts like Merbein, Red Cliffs and Mildura have been left to die. You can imagine the impact that has on the surrounding communities, on all the added businesses. They are living in uncertain times. It is going to take millions of dollars when the drought finally ends to restore all those plantings. These blocks are showing that the water has been turned off. Some families made that decision as far back as 18 months ago and are watching their vines and citrus trees die before them. SunRISE21 is an economic development program we have had in the region for many years now. It has been funded by federal and state governments over the years. It is currently trying to get another project up to get a better measurement of this anecdotal information, but blind Freddy could see from just driving around the region the impact that water shortages are having. The ongoing economic inactivity that will affect the small businesses of the district is starting to come through in, if you like, a tsunami.

The crazy part about all this is that across the border in New South Wales, in the member for Farrer’s constituency, high security Murray irrigators now have 80 per cent of their water entitlement. This is because New South Wales has a different classification for water from Victoria. There is less water for high security and there are fewer irrigators in New South Wales, but an enormous explanation is needed for those irrigators on the Victorian side who look across at the orchards and vineyards of their compatriots in another state who are getting a much larger allocation of their water.

In addition to this, the net result for Victorian horticulturalists on 13 per cent is that they will be competing in the water market against the federal government for the purchase of water. The government’s priority seems to be to purchase water for environmental purposes. For the life of me I struggle to understand how they can put the economic and emotional wellbeing of people that produce food and fibre after the needs of the environment. Of course the environment is important—it is vitally important—but we are talking about human beings and their need to be involved in economic activity, to the benefit of the nation and to the benefit of the regions they come from.

The South Australian government has promised to spend $67 million to buy water for its own high security water irrigators. That is a bold step, and it is just a tragedy that Victoria does not follow suit and back important wealth creators, particularly people who produce food. Murray Valley commodity leaders in the wine, table grapes, dried vine fruits and citrus industries advise me that the lack of appropriate allocation to Victorian irrigators leaves their harvest planning absolutely in tatters. The growers do not know how much they will get for their grapes and other products—if they produce a crop, that is. Because they do not have price, they cannot budget accurately or convince lenders for a loan in order to purchase water to keep those crops growing. The end result is that many fixed planting irrigators are simply trying as best they can to keep their vines and trees alive and have long since given up trying to produce a crop.

When you think about the size and importance of these commodities, the production of wine grapes in the Murray-Darling and Swan Hill regions of the Murray Valley the last vintage was 365,000 tonnes, with a value of $203 million. Many growers had to spend $200 a tonne buying water to get their crop for a return of between $300 and $450. The margin is just not there; they are simply keeping their fixed plantings alive. In citrus, 2007-08 production was 132,505 tonnes, of which more than half was exported, particularly to the United States. In the current season, 2008-09, the prognosis is that the crop will fall to 116,000 tonnes. All of this is due to the lack of water, because without water you cannot produce that beautiful, juicy orange. Dried vine fruit had an absolute shocker last harvest with only 11,300 tonnes produced. In 1998 it was 43,000 tonnes. We are talking about an industry that in its heyday produced 200,000 tonnes of dried vine fruit, all for the export market. The story for table grapes is no better. So there is enormous uncertainty out there.

It is a bitter disappointment that the government’s response to this has been to manage the transition of people like these wealth creators to exit their properties, offering a $150,000 exit grant, which was announced on 20 September, and that the government would buy the water. This is hardly a solution, certainly not a long-term one, to ensure that important, viable communities continue to create wealth. There are currently 940 horticulturists out of 1,400, just in the Sunraysia region associated with Mildura, who are now seeking help from financial rural counsellors. I just hope that the federal Minister for Agriculture, Fisheries and Forestry takes heed of my remarks and does not undo the assistance that has been provided with valuable EC support— (Time expired)