Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

I grieve tonight about the amount of substantial legislation and regulation along with a government funded independent body to protect competition and consumers in this country, in particular with regard to milk and beef prices, and the need for more consideration and more work on behalf of the farmers and the suppliers in the retail market we currently have in Australia.

I acknowledge the ACCC works hard to balance the competing needs of retailers, consumers, producers and processors. All the stakeholders seem to think there is an imbalance in the system, even despite that work from the ACCC. We have had Senate inquiry after Senate inquiry. We have had good intentions expressed. We have had all the rhetoric from all the various players within politics. The ACCC brings case after case, yet these fundamental concerns are growing, not reducing, under the current legislative regime.

Firstly, dairy farmers in my electorate as a group are angry. They start work at 4 am; they finish after dark. They do not get a day off 365 days a year, including Christmas Day. They have to invest heavily in land and infrastructure, and a reasonable return on the value of that land and infrastructure is by and large unachievable on the capital itself. They are totally at the mercy of natural events. Recently no rain for months meant there was no feed on the ground. Rising grain costs cut into their already tight profit margins. When the rain arrived, it resulted in two flood events in a month which meant some who were happy for the rain to come—and then it came too hard—were left having to dump their milk due to isolation and the poor quality of local roads.

In the end, you have to get these stories out of the farmers themselves. They do not complain about these events: they are part of life for them. What they complain about is the playing field, and I hope what the majority of MPs in this place consider to be the unfair, the uncompetitive and the unsustainable playing field that they have.

When the dairy industry in New South Wales was regulated, it was inflexible to the needs of farmers. Still, I stood at Taree West club with a Queensland MP and member of Katter's Australian Party, Bob Katter, over a decade ago and with many others to express worry about how transition would occur and what it would mean for local dairy farmers and the number of farmers on the ground. Despite the nice theory, on paper, about the value of deregulation, when regulation was removed it increased the flexibility of the industry but it also removed a large number of the smaller, less capital intensive farmers on the ground—many of whom were generational farmers in their 50s and 60s who were thinking about handing the farm over to another family member but were jammed in this change from a regulated environment to a deregulated environment.

This was all based on a view that deregulation assumes you are launching a player into a level playing field, but a decade later this certainly has been demonstrated to be not the case. I hear the same thing across many sectors, from not only dairy farmers but also beef producers and suppliers up the supply chain: the ACCC's powers are not effective at addressing the real issues; the ACCC ask for evidence when the true evidence is in the hands of the retailers themselves, not the industries being affected; and the ACCC want processors and primary producers to provide information about major retailers when they are just not in a position to do so. When the powers under our fair trading laws to expose abuse of market power are not used, that in many ways demonstrates the problem itself—the abuse of market power is in the silence that comes from the suppliers on the ground.

Processors and primary producers tell me they have seen those who complain through this complaints process cut from the only markets available to them despite the existence of market power laws. I hear agreement that a simple look makes it appear a consumer is benefiting, and one might ask how can lower prices not benefit consumers? In the long-term, the end gain becomes important—what is a sustainable position for consumers and for competition? The worry is that the ACCC consider only the short-term rather than the long-term impacts of consumer and competition issues.

I also hear the view that milk is an international product, and therefore the appearance of competition exists. But the story of suppliers is that they cannot access the international market at all. I do query our marketing of beef and milk to the emerging middle classes throughout the Asia-Pacific region. Newspapers in the south of the Philippines and newspapers read by many Asia-Pacific families—families that are now coming out of poverty and seeking protein—run ads and stories about how parents can fatten their children; how they can improve their children's access to protein. That is culturally completely different from what happens in Australia.

Why are we not, from an economic and a moral position, tapping those markets? Why are we not building cold store solutions and building a supply chain to these emerging markets? Why are we not considering how refrigeration can play a role in economic development not only for these emerging economies but for Australia's economic benefit as well? It has me stumped—with all the intelligence we have in the farming community and in government, why have we not been able to develop those links better than we have so far?

At the moment we rely on AusAID, we rely on good organisations like ACIAR, the international agricultural research arm of government, but we are still exposed to some very immature trade links with emerging economies that are up for grabs. There are people who want beef and milk. We are a country of beef and milk yet we cannot develop the link between us and them, for some unknown reason. So where is the work to develop these new markets as well as to expand existing markets? This is where I raise the question: where are the levies paid going? What about the R&D? There is plenty of focus on the 'R'; I worry that there is less focus on the 'D' and the development of these new and emerging markets.

I also raise the question of revisiting the issue of the supermarket duopoly. There are many problems facing our producers. The current system either needs reworking or amending to achieve the results our community needs. Instead, we enable the major retailers to continue to increase their market share: from supermarket to petrol to hardware to brewing to videos to liquor—the list is endless. We allow it because in the short term it benefits the consumer.

So, while this market share grows and while big boxes are dropped into many communities around Australia in what is really a battle over market share and title related to market share, in the end, producers and farmers leave their industries in droves. I ask the question whether in the future the retailers sadly will be the farmers and the producers, and the consumer will lose in the long term unless we start to address some of these issues.

I know on the table there is the proposal for a grocery ombudsman. I know there are issues of voluntary or mandatory codes of conduct. I hope they are progressed for all the issues of benefiting the long-term interests of Australia and the long-term interests of what I hope is being part of Australia: a beef and dairy industry as part of the Australian story.

Debate adjourned.

Federation Chamber adjourned at 21:52