Thursday, 17 August 2017
Regional Investment Corporation Bill 2017; Second Reading
It is a great pleasure that, as a member of an electorate in regional Australia, I get to speak on the Regional Investment Corporation Bill 2017. What we heard this week in relation to this bill is those opposite trying to praise the Deputy Prime Minister—the minister who brought this bill into the parliament, the minister whose legitimacy to stand in this place, to sit on the front bench, is in question. And those opposite are saying, 'We're the party of regional Australia; we're the party that now has to bring forward this election commitment, this corporation.'
But the history of this government is continued backflipping on these policy commitments that they make. The backpacker tax was a real corker of a one that really had a huge impact on regional Australia. Having these commitments doesn't actually make these commitments good policy. This bill hasn't got a lot going for it, really.
Those opposite are saying that the Deputy Prime Minister is out there, getting out of his electorate of New England, across regional Australia. Sure, he might go out to regional New South Wales, regional Queensland or a little bit of regional Victoria, where the National Party holds seats, but I can tell you now: this Deputy Prime Minister, this Minister for Agriculture and Water Resources, very rarely comes to my regional state of Tasmania. In fact, last year, I wrote to the minister when I was newly elected, because my farmers said to me—those dairy farmers who were hit hard by the dairy crisis—that they were not hearing anything from the government or any support for them. So I wrote to the Deputy Prime Minister and I said, 'Please come to my state, to my electorate, to my farmers and talk to those farmers.' And he didn't say a word.
Now, this is around the household assistance package for those farmers. That package took the farmers forever to actually apply for; it took them so much time and even a lot of money to actually get their application ready. The reply from the Deputy Prime Minister was a bit of, 'Too bad, so sad. That's the process you have to go through. But I'm not even willing to come to Tasmania to talk to you.' But he's willing to go to National Party seats. That's perfectly fine, but if you're going to be a minister for agriculture—maybe a legitimate minister for agriculture, and we'll see how that pans out—then you need to go through the whole regional area and all the farming areas of this great country of ours.
When we talk about this bill, it talks about the farm concessional loans, which this corporation will look over. There's $4 billion sitting there that farmers aren't even taking up. You have to ask the question of why. I think that's something that the corporation will probably do some work into. I'm the deputy chair of the Standing Committee on Agriculture and Water Resources, and we're doing an inquiry into irrigation at the moment. Farmers and irrigation bodies are saying to us that one real concern for those farmers, who are looking at water efficiency, is energy prices. That is something that this government is in a policy paralysis on. They're not offering any hope to these farmers that they can then switch to more efficient ways of delivering water when there's this high cost of energy associated with that. So a lot of farmers are now probably going back to diesel generation for their pumps. They're not getting the water efficiencies that we so desperately need, particularly in areas like the Murray-Darling, which has been the topic of conversation quite a lot.
What this minister talks a lot about is water development. Since the election of last year, in this current parliament, he has been to Tasmania just once. Just once, for a little fleeting visit to the Southern Midlands irrigation scheme. This is one of those things that is quite quirky about all this: this corporation is going to talk about how we can fast-track the construction of dams and priority water infrastructure, but not one irrigation scheme in Tasmania and not one dam project in Tasmania was ever thought of, funded and committed to by the coalition or the Liberal party at a state level. We have had significant amounts of federal and state money invested into water infrastructure in Tasmania. Every project has been delivered by Labor or planned by Labor. But it's fine for the Deputy Prime Minister to come to my state and claim credit for at least one scheme. There's one that's being built in my electorate in Smithton. The Deputy Prime Minister may very well claim credit for that one as well, but it has all been planned by Labor and I doubt he will pass that credit onto us.
But there's another part of this legislation that is quite concerning, and that's around where this corporation is going to be located. When you have, before the corporation has even started, said, 'Right, we're going to put this corporation in Orange,' then I have to ask: what is the process? You have to ask yourself what the actual process is. They are putting this corporation, with a number of employees to be employed by it, in a location without a process.
The funny thing is that this process that the government has actually looked at to put it here is not even a process. It's a determination that they used when the Deputy Prime Minister decided that he would put the APVMA in his home town of Armidale. If that's not pork-barrelling, then I don't know what is. I say that because that was an absolute disaster, and we all know that. We had our public servants working out of McDonald's, for goodness sake, because the Deputy Prime Minister was adamant that that's where it had to go.
Now we've got the corporation going to Orange, which is fine. That's great for Orange. I think there are 30 jobs, and its operation costs will be $20-odd million a year that this corporation will have. But even those who have consulted on this bill are asking, 'Why is it going to be here?' The Pastoralists and Graziers Association of Western Australia are asking, 'Why has there been a unilateral decision made on this question?' But no-one can tell us why, and I think this is fine if you look at who's actually in the seat of Orange—the member for Calare! It's great for him. He's already talking this up. I think you have to look at whether this is a little bit of a nudge and a wink from the Deputy Prime Minister for the member for Calare where he's saying: 'I'll look after you, mate. I'll look after you.'
Why couldn't this corporation be in a place like Burnie in my electorate, Bairnsdale, Ballina, Bowen, Devonport in my electorate, Deniliquin or Derby? Why weren't they considered? Has the Deputy Prime Minister just spun the wheel and gone: 'We'll put it in Orange because that's where one of my colleagues is. I think the history of that electorate is it was one that was held by Labor for a number of years, then it went independent and now the Nationals have picked it up. We'll bring some jobs there.' That's fine. We're very supportive of decentralisation on this side of the House—absolutely. It has its place, but you have to look at where these people go and what functions they're going to be providing in the service that they're in.
The APVMA was totally one that doesn't work, and I've spoken to people like the CPSU around how we can get decentralisation and bring some of the public sector jobs to Tasmania. We're very cautious about looking at what the functions are that we can support in a state like Tasmania, which is quite removed from Canberra—absolutely. You have to be smart about this. You have to actually think about where these jobs should go. You can't bring a group of highly skilled specialised scientists from Canberra to Armidale and expect it to work without actually doing some consultation. But, no, the Deputy Prime Minister wanted the APVMA right there in Armidale. What about this corporation? The Pastoralists and Graziers Association of Western Australia are suggesting it should be in Canberra. That's fairly reasonable. Was that considered? Who knows?
This is quite an amazing bill! This went through the Senate Standing Committee for the Scrutiny of Bills and there was a dissenting report. I'm just trying to find it amongst all my papers here because it's quite interesting what they have actually come up with. The dissenting report states:
… that the Government:-
this corporation. That's because the functions of this corporation actually exist. The water development projects that happened in Tasmania happened, and they happened well. The future of water development in Tasmania is very, very unknown. We don't know what's going to happen with further opportunities that might arise or that have been identified by Tasmania Irrigation because the government's not really focused on it. Will the corporation focus on the future irrigation needs of Tasmania or dam construction? Who knows? The government has offered mixed messages when enunciating the policy objectives for the establishment of this corporation and has failed to undertake a cost-benefit analysis to give confidence that the $28 million cost of establishing and operating the corporation delivers good value for the Australian taxpayer. That's absolutely quite extraordinary, really. It goes on and on. Thank you to those senators who have provided that dissenting report.
But there's one other issue that others who have looked at this bill and provided some commentary on it have raised, and that is the governance structure. The government has made a really slight amendment to this and they have now established that the board of this corporation will consist of a chair and two people. That's to look after $4 billion of taxpayers' money—two people. Now I think they have extended it in their amendment—because they thought, 'Oh, maybe that's a bit low'—to three. I know that the National Farmers' Federation in their submission stated, 'Oh, gosh, if you're going to be looking after $4 billion, we need a better governance structure here,' and they've suggested at least six. But the government hasn't listened. Of course, they haven't listened. This is $4 billion of taxpayers' funds that is going to be held under a board of three people. There's no accountability around this. If you actually look at the bill, the accountability structure particularly for this parliament is pretty non-existent. When you're dealing with $4 billion of taxpayers' money and you've got a Deputy Prime Minister that said, 'Oh, we're going to place it in Orange, in a National Party-held seat, and we've got a board of a couple of people that are going to dish out this money for water infrastructure development and support for farmers,' where's the scrutiny in it? It's not in this bill.
This parliament has limited say as to what is going to happen under this corporation. A lot of these functions happen now, with our states and territories looking after concessional loans. That's been happening with water development. This goes back to the government having a lack of policy for water development into the future. And I'm sure my colleague the member for Herbert can talk a lot about the lack of water development policy that this government has undertaken, particularly in Northern Australia. The future in irrigation development in my state of Tasmania is really at a standstill. But, thanks to Labor, it has been continuing for the last 10 years with the construction of the Meander Dam in 2007.
This government in the previous parliament and this parliament has really done nothing about water development for Tasmania or Northern Australia for that matter. The policy paralysis around energy is quite staggering. What farmers talk to us quite a lot about, particularly in the agriculture and water community, is: what is going to happen with energy and energy costs and the impost that has on my farming operation? They really do not know. The Department of Primary Industries and Regional Development in Western Australia stated in their submission that anything less than the four members on the board may be perceived as government leaving the decision-making for the $4 billion portfolio in the hands of two people. Two ministers will be overseeing this corporation—the Minister for Finance and the Minister for Agriculture and Water Resources, but the parliament will not necessarily get a say on it. The government has made four tiny, tiny amendments to this bill after it went through the scrutiny process, with submissions from the National Farmers' Federation, bodies in WA, the DPI, and pastoralists and graziers. The government came up with four teeny, tiny amendments that do not get to the heart of what some of these issues are. I say to the parliament: you just can't support this bill. This needs far more work from a Deputy Prime Minister whose legitimacy in this place is under question and whose record is clearly around pork-barrelling and looking after his mates but not regional Australia—certainly not my regional state of Tasmania, which he's been to once. I've invited him to come to my state—no strings attached. I know that the state Liberal Party don't want him there, because I've had members of the Tasmanian Liberal Party tell me that. And that is sad. That is really sad. I hope we can get over this and I hope this government can start looking at the issues that matter to our farmers the most.
I commend the Regional Investment Corporation Bill 2017 to the House. What we're looking at here is delivering the Commonwealth's farm business concessional loans through a system which is nationally consistent. Why? Because the current system, where the concessional loans are allocated through the states, is simply not feasible in the long term. It significantly limits the Commonwealth's ability to respond to the changing needs of the farming sector. With each state delivering the program, loan decisions are not being made in a consistent way across the country.
How do I know that? I know that because I come from South Australia. In my time in this House, my electorate, sadly, has had to deal with drought and the dairy crisis. During the drought, in much of the upper south-east there were farmers across the districts pleading with government for access to drought concessional loans. Of course, funding was made available by the federal government, but applications needed to be made to Primary Industries and Regions, South Australia—the South Australian state department—under the leadership of the current Minister for Agriculture, Food and Fisheries in South Australia, Labor's Leon Bignell. Despite there being incredible need and hardship, despite me sitting at the breakfast table with farmer after farmer pouring their hearts out to me about the circumstances they found themselves in, the financial stress that was transposing itself into personal stress in their family lives, with stories of marital break-ups and difficulty with children and their education, what did we see? We saw a few paltry crumbs off the table arriving to the odd—and I say 'odd'—farmer in South Australia.
You don't need to take my word for it. You perhaps wouldn't want to. But a recent National Audit Office report found that, because of the very low number of successful applications in South Australia, processing costs for each successful application in South Australia for the concessional loans program amounted to—wait for it—$416,000. These loans were available up to $1 million. So, in going through the process of assessing these loans, the South Australian department effectively rendered an invoice to the Commonwealth for each successful application for $416,000. When I calculated the net benefit to the small number of farmers that got access to the concessional loans, it was a small fraction of what the state government had charged the Commonwealth for administering the program. This just can't go on.
Those opposite seem to be railing against it. But do you know who's not railing against it? It's the minister for agriculture in South Australia. Even Leon Bignell gets that the gig's up. Agriculture minister Leon Bignell said he welcomed a nationally administered scheme. Maybe those opposite—the member for Hunter, in particular—haven't got the memo. We have the state Labor agriculture minister saying: 'Please, take this burden away from me. I'm incapable of administering this program consistently or at least consistent with other jurisdictions.'
I have spoken about the drought, but let me speak about dairy farmers and dairy farming. It is a significant industry in my electorate. They are farmers who, probably more than most, are heavily indebted and highly geared because of the nature of the farm work they undertake. I take my lead from serious advocates in this space, particularly those in South Australia. I refer to Andrew Curtis, who is the chief executive of the South Australian Dairyfarmers' Association. What did he say on this front? He said—and it's not too much to ask:
We want clarity (around the scheme) and we’re not getting it from the State Government, so from that point of view it would be good if the Federal Government took it over.
If those opposite are not prepared to accept that the National Audit Office was gobsmacked at the cost of administering the scheme in South Australia, if they're not prepared to accept the plea from the Labor minister for agriculture in South Australia, could they please listen to the South Australian dairy sector? They said:
… from that point of view it would be good if the Federal Government took it over.
I'm not particularly disturbed by the attitude of those opposite—I understand that, invariably, if I come into this place and say, 'White is white,' those opposite will say, 'No, white is black,' and we'll go on this never-ending carousel ride of yes/no blame politics.
What I was most disturbed by yesterday was the contribution from the member for Hunter. The shadow minister with responsibility for this sector indicated to the House yesterday that this bill did not have the support of the Senate crossbench. It takes a bit to shock me. My staff entered my office and asked if something serious had happened. I had gone white, because I thought, 'I get that those opposite are just going to play politics, but not the Senate crossbench, not Senator Xenophon.' I remember Senator Xenophon leading a Friesian heifer in support of the dairy industry. Indeed, Senator Xenophon ran a candidate against me who, by the way, didn't live in my electorate, but was previously associated with the dairy sector. I thought that, of all the crossbenchers, he would be the one rushing to support a bill which has been called for by the South Australian Dairyfarmers Association and Primary Producers SA and supported by the National Farmers' Federation. Hence I had gone white—this could not be true; this could not be right.
So I made inquiries. At this stage, the only person we have on the record is the member for Hunter. He is speaking on behalf of the coalition of Labor and minor parties, but the good news is I see from the speaking list that after my contribution there will be a contribution from the member for Mayo. The member for Mayo is the only person in this House who represents the Nick Xenophon SA Best party. She represents an electorate that has a significant proportion of dairy farmers and dairy farming industries. She has an opportunity, when she makes her contribution in this place, to give unconditional support to this bill—not conditional support, not in-principle support, not any other series of words that seek to enable Senator Xenophon's flexibility in the other place; the member for Mayo has to walk into this place and say, 'Madam Deputy Speaker, colleagues, anyone listening around the nation, we in the NXT unconditionally support this bill, because we unconditionally support dairy farmers and unconditionally support farmers around Australia.'
If she is unable to do that then, in effect, she and the Nick Xenophon Team are saying that they're perfectly comfortable with Minister Leon Bignell in South Australia and his department continuing to administer these loans. They might be perfectly comfortable with that, but I've spoken to a number of dairy farmers and I'm yet to find a farmer, let alone a dairy farmer, who's comfortable with that position. If it is the case that we end up in a situation where the member for Mayo is incapable of confirming in this place that her Senate colleagues will unconditionally support this bill in the other place, she is going to have to deal with some seriously angry farmers. It wouldn't be my approach, if I could offer them some free advice.
Why are the dairy men and women of South Australia angry? Well, in dairy recovery concessional loans alone, the federal government made available $15 million to South Australian dairy farmers. Bear in mind that these are dairy farmers who are dealing with a crisis the likes of which we haven't seen in this sector. The commodity price hasn't so much fallen as taken a nosedive off a cliff. Of course, this is a sector which is particularly input hungry—that is, the cost of churning out milk involves significant inputs. Those inputs are expensive and, at this point, there are a number of dairy farmers who are operating below the cost of production or at least achieving prices below the cost of production.
So you would have thought that every single dollar allocated by the federal government to this program for the benefit of South Australian dairy farmers would have been allocated to them—every single dollar—and every application would have been accepted, or at least every application within the funding envelope that the federal government gave to the South Australian government to administer. But you will be surprised to learn that wasn't the case. Of the $15 million that was allocated by the federal government to the South Australian state Labor government to allocate to their farmers—very many of whom live, work and employ people in my electorate—only $8 million was allocated. Of the $15 million, only $8 million was allocated. Now, you might say: 'Well, look, you're being cute. That's probably all the applications there were.' No, there were 14 applications received and eight applications granted. So, there are six dairy farmers—I happen to know a large percentage of them in my electorate—who went to the considerable trouble of making an application for a dairy concessional loan.
For those, perhaps those in the gallery, who are not as au fait with what a dairy concessional loan is: it's a loan, not a grant. It's effectively a mortgage from the federal government, just like you get a mortgage from a bank, but it's at a significantly reduced interest rate. It basically means you can go to your bank and say: 'Of that $5 million I owe you, I will transpose that to $4 million for you and $1 million for the federal government. The nine per cent interest I'm paying to you is on the $4 million and I will pay the much lower interest rate on the $1 million loan from the federal government.' It has to be repaid. These aren't grants. Nobody in the sector is after that. But there are six farming families who went to the considerable trouble of making an application, and they were rejected. They were told: 'No, we've got the money sitting here, but you're not having it. Keep getting up every morning, keep milking your cows and keep seeing the equity in your farm whittle away day by day, because we're not going to allocate that to you.' That's what has happened.
The member for Mayo will contribute to this bill later today; she's on the speaking list. I would hate for her to take the opportunity to delete her name from the list. If she is incapable of coming in and saying that not only she but the senators of the Nick Xenophon Team give unconditional support to this bill, then she's saying to those families and the swathe of other families who didn't make an application, because they knew PIRSA would knock them back and they were waiting for the federal government to take charge, 'I don't care.' That's what she's saying: 'I don't care. I'm particularly and personally happy with the work of the minister in South Australia, Leon Bignell, and his department.'
I give thanks to the member for Braddon for her fantastic comments about what it's like to live in the regional part of Australia in Tasmania. I too am pleased to stand, as a regional member in North Queensland, to speak against the Regional Investment Corporation Bill 2017. I have Magnetic Island and also the remote location of Palm Island in my electorate, so issues that are raised in this bill are particularly pertinent to my community.
I have just one question for the Turnbull government: how well is the last concessional loan scheme you set up—that is, the Northern Australia Infrastructure Fund—going? The answer is: not very well. More than two years on, not one project has commenced; there is not one shovel in the ground; there is no economic boost for North Queensland; and the only jobs the Northern Australia Infrastructure Fund has created are for board members, the CEO and staff. More money has been spent on paying the board and organisational wages than on funding for actual delivery of projects. Instead of the Turnbull government learning from their mistakes, they have created another concessional loan fund. So how long will the regions have to wait for this one? How long will you be paying the board's wages on this before delivering anything?
After the Turnbull government's budget announcement, I met with local business leaders who work across sectors including the agricultural industries, regarding this fund. I was genuinely interested to know how they thought this fund would benefit them and our region, and what it meant for North Queensland in general. Every single one of them said they were taking this announcement with a grain of salt and had no high expectations at all. All business leaders commented they expected it to be like the NAIF: a nice announcement by the Turnbull government but unlikely to actually do or deliver anything. This goes to show just how out of touch this government really is when it comes to regional Queensland. They can't even sell the first concessional loan scheme, and, instead of trying to fix the issues with the NAIF mess, they set up another loan scheme and then another and then another before they manage to get the first one right. The Turnbull government have created more concessional loan schemes than they have created projects to fund.
Let's talk about the slap in the face that the National Water Infrastructure Development Fund has been for the north—another loan scheme where a community is drought declared, on level 3 water restrictions, with less than 20 per cent in our Ross River dam, and Townsville does not qualify to access funds from the National Water Infrastructure Development Fund. How does the fund deny drought-declared communities, including the largest city in north Australia that has a desperate need to secure long-term water security? Why would the minister for resources, Deputy Prime Minister Barnaby Joyce, create such ridiculous red-tape rules? What's even worse is that the Queensland state government has to make funds available because the Turnbull government could not get its own announcement right. The Palaszczuk Labor government had to find $15 million for interim funding to support the Deputy Prime Minister's National Water Infrastructure Development Fund to ensure that feasibility studies could go ahead in Queensland. The Deputy Prime Minister, Barnaby Joyce, made such a mess of his own fund that he forgot to advise the proponents that they would receive their funds in arrears. Let's not forget the new drought concessional loan, which has also experienced a very poor take-up rate. And why has it had a poor take-up? Because once again the Turnbull government did not consult.
The Regional Investment Corporation will face the same difficulties as the drought concessional loan. Its role is to provide loans to farm businesses, subject to the applicant meeting specified criteria. The 'subject to the applicant meeting specified criteria' will be centred on the viability of the farm business. It is important to understand that the RIC will be the bank of last resort, as farm businesses will need to be assessed as being viable. Determining whether a farm business is viable has been a major issue for the states when developing the guidelines for concessional loans, and this will continue under the RIC. Furthermore, the concessional loans are only for a period of 10 years. Post 10 years, the farm business will need to re-engage with their bank to secure finance if necessary.
Why can't the Turnbull government get just one of their concessional loan funds right before they start another? This new fund will be like all of the other Turnbull government loans, because the fact is that this government has done no cost-benefit analysis at all. The concept of the RIC has been developed with no cost-benefit analysis as to whether or not the corporation will actually deliver any of the claims put forward by the Turnbull government. In particular, there are no costings on whether the RIC will help fast-track the construction of dams and the priority water infrastructure projects needed to stimulate investment, economic growth and increased agricultural productivity in rural and regional communities.
The location of the RIC in Orange makes sense, building on the existing base of agricultural investment institutions in the city, including the New South Wales Rural Assistance Authority and Macquarie Bank's Paraway Pastoral livestock enterprise. The Farm Business Concessional Loans Scheme and the National Water Infrastructure Loan Facility are intended to be budget neutral over their life, with the establishment and operating costs of the corporation recovered by the interest charged on loans to farm businesses and state and territory governments.
The Turnbull government has not done any cost analysis on any of the issues I just raised—more proof that the Turnbull government are great at making announcements but totally lacking in their ability to deliver actual projects. You cannot do this to the people of North Queensland, because they have very long memories. Our communities are facing tough times, and we need real answers, not pie-in-the-sky ideas from the Deputy Prime Minister. The true cost of establishing the Regional Investment Corporation is $81 million over the forwards, with the potential to be higher if the uptake on the loans is low. The existing loans administered by the states and territories will remain the responsibility of the states and territories. Establishing a new body to administer new loans is a waste of taxpayers' money, is inefficient and is costly; $81 million would be better off spent on delivering real projects and real jobs, and I could give the government a list that Townsville would certainly benefit from.
If the Turnbull government really wants to deliver for regional Australia, in particular North Queensland, they should invest in delivering infrastructure projects and not concessional loans. As I said, if this government is short on ideas regarding regional investments they could take a moment to go to my Facebook page and view the dozens of speeches I have made in this place outlining my demands for North Queensland: water security for Townsville, energy security for Townsville—and no, the answer is not a pamphlet plan—reinstate the 200 jobs that the LNP government have cut from the Australian Taxation Office in Townsville, reinstate the jobs in the Department of Veterans' Affairs that have been relocated to Brisbane, and reinstate all regional job losses and relocations, including the five jobs lost from CASA in Townsville. The bare minimum the Turnbull government could do for regional Queensland and this concessional loans scheme would be to at least locate the RIC office in North Queensland.
There has been no transparency in this process; it's just been decided to locate the Regional Investment Corporation in Orange. Why Orange? Why not the Burdekin? The Burdekin has a strong agricultural economy, and their diversification and business models are absolutely amazing. Mayor Lyn McLaughlin has been a great driving force, together with many agricultural organisations in the Burdekin region. North Queensland will become an agricultural hub with growing connections to India and other Asian markets for agriculture, so why would the government not locate the RIC in the Burdekin? Where is the member for Dawson? I ask again: where is the member for Dawson, George Christensen? Why did he not stand up for the Burdekin, which is actually in his electorate? I am here standing in this place, fighting for the Burdekin community, which isn't even in my electorate, and I note that he is not even on the speaking list.
Allow me to reiterate the facts on this bill so far. The Regional Investment Corporation has not been costed. It costs $81 million—possibly more—to administer. No transparent or fair process has been undertaken by the government to determine where to locate the RIC. It is highly likely to be similar to the other useless Turnbull government concessional loan schemes that do nothing. And any funds from the National Water Infrastructure Development Fund, as and when they cross over with this fund, are potentially going to be in arrears, with the Queensland government likely to be forced to pick up the federal government's bill again. How could any reasonable person support this bill, especially knowing these facts?
The Turnbull government has to stop making useless announcements and get on with the job of actually delivering projects. I am opposing this bill, because it is a complete and utter waste of taxpayers' money. It will do nothing to deliver projects for North Queensland that could and will create jobs, beyond what the state and federal governments are already doing. I do not support the location in Orange, and I am not supporting any harebrained loan scheme that won't do anything for North Queenslanders, who are desperately in need of jobs. My advice to the government would be: go back to the drawing board. The north is not fooled by this announcement. It is not going to help us in the north. If this bill passes, we will expect the same results as are evident with all of the other announcements from the Turnbull government—all fluff and no guts.
Drought, floods and fires are, of course, constant companions of Australian agriculture. As a farmer, I know that—it's in my DNA, if you like. As farmers, we do need to have resilience. We do need to be able to cope on a day-to-day basis with most of those challenges. But there are times when we are tested beyond our limits: when a drought enters a second year, a third year, or a fourth year. There is no realistic way for any business to be able to budget and allow for that type of catastrophic failure. It's a repeated story in Australia. We could just let the market rip, and there would be some agriculturalists—those who are in a stronger position—who would get bigger on the back of those types of rationalisations. But what we also need to consider is the fabric of our rural communities.
By and large, governments, over a long period of time, have tried to reach some middle ground when it comes to drought and disaster relief. While we accept that we need farmers to be competitive and to be up to the challenges of both the market and the environment, there come times when we just cannot allow a large number of them to fail, and we need some kind of mechanisms to back them up. A lot of these policies, despite the best intentions of both sides of parliament, are made in an ad hoc manner—'Yeah, we've got a policy'—but then they get tested. The weather tests us beyond the limits of the policy, and then governments have to make another move.
Upon coming to government in 2013, the drought policy cupboard was bare. We'd had the previous exceptional circumstances arrangements, which accompanied the millennium drought, under the Howard government. Then it began to rain right across Australia, and it got to the point where there was nowhere in drought—in fact, we were dealing with floods, to be quite honest—and so those policies were wound up. But there was nothing put back in their place. Upon coming to government, the droughts have returned—certainly not the Australia-wide droughts of the millennium drought, but there have been some very difficult patches. Some of my electorate of Grey has been significantly affected.
The Regional Investment Corporation Bill is progressive policy. We are trying to cement into place policies that are developed not under the pressure of the minute but have a long-term prospect for underwriting Australian agricultural production in the nation's interest. The bill establishes the Regional Investment Corporation as a corporate Commonwealth entity and delivers on the coalition government's election commitment of $2 billion farm business concessional loans, and $2 billion for water infrastructure loan programs in the Agriculture and Water Resources portfolio.
I said that essentially we came into this area having very little policy on the shelf. Since 2013-14 the Commonwealth has been offering concessional loans to farm businesses to help them through these times of difficulty. Concessional loans are a very important part of the government's drought policy framework. One of the main reasons is that the enthusiasm of the banks—who are the major financiers of agriculture and many other things in Australia—for agriculture and other things waxes and wanes. It's not a consistent source of money that farmers can rely on. Sometimes, as farmers, we feel as though the banks are throwing money at us. At other times, you can't get two and six out of the banks to get you through to the end of the week. So having the Commonwealth concessional loans in place actually presents a sort of stability in the market. It's the lender of last resort, but it does help stabilise the market and it helps stabilise the commercial market as well.
To come to the detail of the Regional Investment Corporation, the concessional loans that we've had in place since 2013 have been delivered through the states. In my state of South Australia, that means Primary Industries and Regions, SA—or PIRSA. That is what we call it. I'll come back to that in a moment. This is a very important point to do with why I am so strongly supportive of this legislation. As well as administering the farm business loans, the Regional Investment Corporation will administer the government's National Water Infrastructure Loan Facility. In the past, delivering through the states has proven unwieldy, with a lack of consistency across the country. Currently the Commonwealth has to negotiate separately with each state government to change existing arrangements or roll out a new program for farmers.
I said I'd come back to PIRSA and their role in the concessional loans that have gone out to South Australian farmers. The Commonwealth has delivered $724.4 million of loans throughout Australia since this program was instigated in 2013. In South Australia, despite vast regions being in drought, there has been $17 million. It doesn't matter how you slice up the pie, there is something intrinsically wrong with this. I and the member for Barker, who spoke previously on this bill, have tried and tried to get to the bottom of why that discrepancy exists. Why is it possible for farmers interstate to access these concessional loans but it seems all but impossible for farmers in South Australia to do so? We keep coming back to the door of PIRSA and the South Australian government. I am bereft of an explanation as to why they have made it so difficult. It is not as if we asked the South Australian government for a co-contribution. All we asked them to do is run the concessional loans program, and yet they seem to be so reluctant to support our South Australian farmers. I don't know why that is.
If I were a state government, I would be out there backing my farmers all the way. But, for whatever reason, these blokes—and I use 'blokes' as a generic Australian term—don't seem to have any enthusiasm for our South Australian agriculture at all. In fact, that is across a wide range of programs. We have seen state governments in Queensland and New South Wales putting in state contributions around drought relief—like freight subsidies, for instance. We've never been able to entice the South Australian Labor government down that path. They just do not seem to want to back agriculture. They will refrain, in fact, from declaring an area drought-declared in case there is a financial implication for them. But, in the case of these Commonwealth concessional loans, they don't have to put any money in and yet they still won't back it. We got $17 million out of $724 million. It's a disgrace.
So I am absolutely in favour of us at the Commonwealth level taking over this entire capacity so we can get consistency across the nation. We are, after all, a national government. We are a national government and we should have nationally consistent programs. The trouble is that, when we filter things down through the state governments, they get corrupted at that level. I think we can probably say that across a wide range of programs, but on this particular day we are focusing on agriculture. Those figures that I have quoted to the House so graphically demonstrate exactly what is wrong with the current system.
So the loans under the new regional investment strategy will not be exactly the same as those currently offered. The system will be broader, with the loans drawing on constitutional authority that includes the Commonwealth's trade, commerce and external powers. The restrictive approach to assessing loan applications, which has had very low approvals, will be upgraded. We will reduce some of those restrictions. There's not much point putting money on the table for people who are struggling to stay on their properties and then making it too difficult to access, so we are here to help, as I think this government have been since we were elected in 2013. I get to talk to a lot of farmers. I have been very proud of this government's engagement with agriculture. I think over that period of time we have done very well.
We certainly now are making the 10-year commitment on farm business concessional loans, but we have upgraded the access for farm household allowance during times of financial hardship. One of the things that I argued for very strongly—and I approached the agriculture minister over it repeatedly, let me say—was the lifting of the thresholds, the limits, in the farm management deposits scheme. This is something that I used as a farmer before I entered politics. I found it one of the most enabling pieces of policy to allow farmers to plan for the inevitable droughts—and the inevitable floods, but generally the droughts—and it became quite apparent to me that many of my farming friends continued to expand their properties. As I have said in this House on many occasions, that's good for the farmers, it's good for the state and it's good for Australia. They farm the land in a very good environmental fashion, but it does tend to claw at the intestines of regional communities, unfortunately.
Some of these farmers are spending up to $4 million putting in a crop. The idea that they had $400,000 set aside to cover a drought—it was simply not enough in this environment. Farming is a very big business. It's a very expensive business. It doesn't have big margins, so it is high investment for moderate returns. So the lifting of the farm management deposits to $800,000 per person was a great step forward. We have delivered on that.
We have accelerated depreciation on water reticulation, fencing and fodder storage. There is a 100 per cent write-off on water reticulation, one of my favourite schemes. I keep telling farmers on Eyre Peninsula, 'You need to put in plastic-lined dams and plastic water runs.' I can give you some figures, but I haven't got the time now. But the water run-off, when you get 100 per cent, is enormous. It is absolutely enormous. It is a great opportunity for farmers at the moment to take advantage of the accelerated write-offs that this government has put in place for them.
We've also guaranteed the future, if you like, and put in a better funding line for the Rural Financial Counselling Service. It's a vital service to so many farmers when they're under pressure.
We've had the $20,000 instant tax write-off for capital equipment—not just for farmers, of course, but for businesses right across Australia. We have extended that time frame. I personally hope that we make it permanent, but let's see what future budgets bring us. We have lowered the tax rates for small and medium businesses. I think something that's probably not been well advertised out there to our businesses, many of which operate as partnerships, is that there are commensurate reductions in taxation for partnerships as well that are running those same and similar businesses. We put an extra $100 million into agriculture research.
One of the things that I say brought me into parliament in an indirect way was access to good levels of education, particularly to tertiary education for our kids from the country. I am a great supporter and very appreciative of the government's moves to eliminate farm assets from the assets test for independent youth allowance and just rate that on an income assessment, because we know well the old story about farmers being asset rich and income poor. This has addressed an anomaly that has sat in the system for some time. Sometimes our assets are worth more than others, but with the vagaries of agriculture that I addressed right at the start—drought, fire and flood—these are variable assets which sometimes are locked up very tightly and in times of drought are producing no income.
All across a wide front, across a wide range of areas, this government has delivered for farmers. It's not surprising that we do deliver for our regional areas, because the coalition are largely, almost exclusively, the federal political representatives of rural and regional Australia. Thank you.
I rise to support the passage of the Regional Investment Corporation Bill 2017. As many of you know, from my previous speeches in this place, my passion and commitment to regional Australia knows no bounds. My electorate of Mayo contains some of the best agricultural produce in the world. In fact, the Adelaide Hills just won the nation's most outstanding region award at the 2017 delicious. Produce Awards. We have a myriad of apples, pears, cherries, strawberries, beef, sheep and crops. There are 93 separate dairy farms within my electorate borders, along with seven separate wine regions.
The future of agriculture in Australia directly impacts on the future economy of my electorate, and I see a very bright future for Australian agriculture. I have previously discussed in this House that, by 2050, the world's population is expected to increase to 10 billion people. A large majority of this increase will be on our doorstep in Asia. This creates an enormous opportunity for Australia's agricultural sector. I have long advocated for putting the right measures in place now to ensure that Australia benefits from the incoming great dining boom. The growing Asian middle class demands high-quality produce, and who better to provide that produce than Australia? We are perfectly placed to reap the rewards of increased demand.
I'm a very strong supporter of the measure in this bill to give control of the Farm Business Concessional Loans Scheme to the Regional Investment Corporation. I stood in this House earlier this year and discussed how, by leaving it to each state and territory to administer the scheme, perverse outcomes were being created. There is inconsistency in application. In my state, the dairy recovery loans have been under-utilised, due in part to the state government refusing to consider water allocations and livestock as part of the land value when assessing eligibility. This is different to other states and territories, particularly Tasmania, which assess both water rights and livestock.
Since the dairy recovery loans were introduced, there have been 228 farm businesses approved for funding. Of this 228, only eight South Australian dairy farmers have had their loans approved. The total value of loans approved in South Australia is $7.5 million—compared to $109 million in Victoria. For all concessional loans programs from 2013 onwards, South Australian farm businesses have been paid $17.2 million out of a national total of $724 million. That is just two per cent of the total value of loans approved going to farm businesses in South Australia. A move to a nationally consistent application of the loan scheme is fair for all farmers. It means some farmers will no longer be denied federal assistance just because their land is on one side of the border.
Similarly, a $2 billion investment in water security and infrastructure is very welcome. I'm privileged to have the Lower Lakes in my electorate. I think I can speak for all South Australians when I say we know about the importance of water security, and thankfully my state is no longer in drought. But I am not so naive as to think drought won't return in the near future. Investments in water infrastructure will help to protect our regions in the future. While I'm on water security, I want to again address the allegations of theft aired in the ABC's Four Corners program on 24 July. These allegations are shocking, but perhaps what's worse is the seeming lack of concern from members of the coalition. It is hypocritical and condescending for the government to introduce measures designed to boost water security while also turning what I see as a blind eye to serious allegations of water theft in the Murray-Darling Basin. I have previously called on the Deputy Prime Minister to step aside from the water resources portfolio, and I reiterate that statement here today. The Murray-Darling Basin Plan is not perfect, but it is a strong plan. It's a national plan and it's a shared plan. It's born out of compromise and it's is endorsed by this parliament.
While I applaud the federal government for its $4 billion commitment to the Regional Investment Corporation to Australian farmers, I want to make a point I have previously made in this House: Australian farmers are not looking for a handout. I speak to farmers every week in my electorate. They pride themselves on not having to lean on government for subsidies like farmers do in other countries. But, as farmers have supported this country in the past, the country must also lend its support to farmers at times when needs arise. These measures secure that assistance, and I commend the government for introducing them.
I would like to speak briefly on the controversy that has come up with the announcement of the Regional Investment Corporation to be located in Orange in New South Wales. Critics will point to the Deputy Prime Minister seeking to shore up a marginal New South Wales electorate. I want to say here that I am a supporter of decentralisation. However, decentralisation needs to be a policy beyond placement of jobs in northern New South Wales. I want to make special mention of the member for Indi, Ms Cathy McGowan, who has pushed hard for a House select committee inquiry on regional development and decentralisation, and I look forward to this committee examining the benefits of decentralisation and the positive impact it can have on regional communities.
I note the Labor Party have raised some concerns with this bill, including the lack of accountability and parliamentary oversight. While I understand that the Regional Investment Corporation will be able to be called before the Senate estimates process, I would like to see more parliamentary oversight for a corporation that will be handling billions of dollars of taxpayer money. I'm supporting the passage of this bill so that my Nick Xenophon Team colleagues can review the Senate committee report and examine the bill in further detail. Like me, my NXT colleagues are committed to ensuring that regional Australia continues to prosper.
Deputy Speaker, I was just in my office listening to the debate on this bill and I would like to raise with the House what appears to be something that I am finding quite awkward, and that is the member for Barker's fixation with me. It's becoming quite weird. Instead of talking about farmers, the member for Barker, who spoke just moments ago, spent a considerable amount of his time talking personally about me. I know that the Nick Xenophon Team candidate, James Stacey, who is a former dairy farmer and a true grassroots representative of his community, only had six weeks to campaign in Barker and during that time reduced the member for Barker's margin from 16 to 4.7 per cent—the closest margin in Barker since 1943. Perhaps the member for Barker has received some new polling that he is finding deeply concerning. I'm not sure, but I must say that I am finding this rather perplexing and certainly awkward and weird. I don't presume to give the member for Barker advice in this place, but I will say that his constituents, judging by those who ring me to pledge their support, want a member who cares and connects with their community and who is not distracted by petty party games.
In closing, regional Australia is the lifeblood of this country. Over 314,000 people are employed in Australian agriculture, which is fast becoming the major driver of the Australian economy, with the end of the mining boom. Too often the federal parliament and state parliaments focus on the metropolitan areas at the expense of the regions. If we want Australia to grow and to succeed over the next 50 years, investment in our regions is of paramount importance. For that reason, I support the passage of this bill.
I rise today to speak on the Regional Investment Corporation Bill 2017 and to speak against the amendment moved by the member for Hunter. Just for those who might be listening to this broadcast, I will read the member for Hunter's amendment. It states:
That all words after 'That' be omitted with a view to substituting the following words:
'the House declines to give this bill a second reading as it places the Government's political interests ahead of the interests of Australia's farmers'.
That is the member for Hunter, the agriculture spokesman for the Labor Party. The reason I quote that is that I have been listening to the contributions of the members of the Labor Party in this House and they're speaking, supposedly, in support of the amendment that says that they don't want to give this bill a second reading, but they spend most of their time saying how the Regional Investment Corporation should be in their electorates. Either they are opposed to this bill or they are for it. I think it is a little strange.
I am in strong support of this bill. I think it fulfils a promise that was indicated in the ag white paper that Minister Joyce introduced several years ago. What this bill will do is streamline the concessional loans to farmers, those who are struggling with issues around drought, dairy deregulation, decline and other such things. I do believe it has the potential to grow into much more over a period of time. I was listening to the member for Hunter's contribution to this debate. He was talking about the Minister for Agriculture and Water Resources, Minister Joyce, and his contribution to his portfolio. I might say I believe that the ag white paper and the policies that have grown from it have been, possibly in my lifetime, some of the most influential changes to agriculture. I might remind the member for Hunter, who is sitting at the table, that the farmers in Australia in my electorate are a resilient lot, but there is one thing that the farmers in my electorate fear more than a hailstorm at harvest time, and that's a Labor ag minister. A Labor ag minister is about as welcome as lousy weather at shearing time.
For the member for Hunter to move this scurrilous amendment to discredit what is an essential piece of legislation, I think, is indeed very short-sighted. That is because agriculture has now regained its rightful place as one of the leading drivers of the Australian economy and certainly one of our largest income-earning exports. The policies that have been put in place by this government are having a real effect, not just for the farmers in Australia but for entire communities that are economically intertwined with the farmers. I will give you a great example: the instant write-off for water and fencing has put a huge boom into the ag supply business for contractors right across Australia and particularly in my electorate. If you drive around my electorate, you'll see there is a shining new tank on the top of nearly every hill and a water supply that will enable those farmers to much better manage their property and pasture the next time a drought hits. There is the ability to re-fence their properties and get an instant tax deduction for that so that they can manage their assets in a more efficient and sustainable way. There is the ability to have accelerated depreciation on fodder and grain storage. If you once again drive around my electorate you will see shining new silos and sheds all over the place because of the taxation advantages that these farmers can take to prepare themselves for the next time there is a dry period of time.
I was here in 2008—from memory, I think the member for Watson might have been the agriculture minister at the time—when the agriculture minister removed the word 'drought' and replaced it with 'dryness'. He said, 'This is climate change, and we've just got to get used to it.' In contrast to that mindset, this is a policy where farmers take control of their own future and invest in their own sustainability, a policy that has faith in the rural community because they are the ones who know how to best manage what is happening. The other thing is recognising the fluctuation in income. For instance, in the north-western part of my electorate, around Walgett, they've had four drought years in the last five years. Last year was an exceptionally good year. Farm management deposits being increased up to $8,000 gives those farmers the opportunity to level out their income and control their cashflow to a degree so that they can manage these times better and they are not coming to the government in a dire circumstance like we've seen in the past.
The other change from this government that has been a real boost to the economies of rural Australia, and particularly my electorate, has been the $20,000 instant asset write-off. Suppliers of small equipment—bikes, quad bikes, side-by-sides and cattle yards—and a whole range of people have had a real economic boost because of policies that have been put in place by this government, in this parliament, driven by the agriculture minister, the Deputy Prime Minister, that are having an effect day after day in regional Australia.
We can combine that with some of the larger projects. The one that is of particular interest to me is the Inland Rail. About 700 kilometres of the Inland Rail will come through the Parkes electorate. Already, we're starting to see businesses and farmers looking at how they can take advantage of the efficiencies that that will bring in their freight, and we're starting to see councils align their planning for roads and infrastructure to tie in with this rail network so that we will have not only the cities of Melbourne and Brisbane connected but also every capital city in Australia connected for the first time. The farmers, the agribusinesses and the manufacturers that are in western New South Wales will have access to cheap and efficient freight all over Australia and to numerous ports around the country.
This is a red-letter day for regional Australia—to have another piece of legislation coming through to back up the economy of that region. I might comment on the member for Mayo's contribution and some of the contributions from the other side over the last couple of weeks about the Four Corners program. There are four investigations under way at the moment about the accusations that have been raised, and they are accusations. My electorate is particularly affected by this because not only do I have the downstream people who are affected by the water management in Broken Hill—Broken Hill is the canary in the coalmine when it comes to the health of the Murray-Darling system, more so than Adelaide, even—but also the irrigation industry that I represent is also important to my community, so I've got both sides of the argument.
Members have come in here and spoken like an accusation on a television show is somehow a fact. The people that have been caught up in that television show have been denigrated without any form of redress. I think we should wait and see what these inquiries come up with. If they indeed show that there has been illegal behaviour, corruption or any misdemeanour of any sort, then action should be taken. But, until then, I think people should be very, very careful about what they say. The Labor Party has form on this. We saw the Four Corners program on live-cattle trade. The federal government now has a lawsuit running from the northern cattlemen because of that program. An entire industry and an entire region was decimated by a knee-jerk reaction. I need to remind the people of Australia that, if the Labor Party were on the government benches last week, we would've had the same knee-jerk reaction. Where was the former minister for agriculture then instead of sticking up and defending the farmers that were supposedly the responsibility of his portfolio? Where was he then? He was lock, stock and barrel with the rest of them—chanting across the table baying for blood. I just think everyone needs to be very, very careful. The people of Broken Hill are very concerned about what's going on upstream, and so they should be. But we just need to wait and see what comes out of this.
So, I strongly support this bill. I'm strongly opposed to the amendment by the member for Hunter, and I would encourage everyone who's involved with regional Australia, everyone who's involved in the agriculture industry, to have a look at the amendment from the member for Hunter and see where his energies are being placed in his role as the Labor Party spokesperson for agriculture.
The Regional Investment Corporation Bill 2017 claims to achieve two outcomes, and both of them are intended to support the agricultural sector. The first outcome is to establish a national water funding program. Secondly, it's intended that this legislation will provide funds by way of loans to farmers during times of need and events that are beyond their control.
Governments, particularly the federal government, have an important leadership role in building the nation's infrastructure. Governments also have responsibility in building industry sectors, and in times of need to ensure that those industry sectors remain viable. It is in the national interest to do that. Good governments have always done that and should continue to do so. During the economic downturn of 2008 the Rudd government's economic stimulus measures ensured that Australia did not go into recession. Coalition members are all too quick to criticise the Rudd government's initiatives at the time, which saved Australia's economy, but they are just as ready to boast that the Australian economy has continued to grow every year for the past quarter of a century. That would not have happened were it not for the Rudd government's economic stimulus measures during a time of need.
Despite that growth, there have been industry sectors that have gone through difficult times and for which government intervention could have made a substantial difference. The farming sector is one of those industry sectors. Agriculture contributes significantly to both national employment and national economic productivity. It is and always has been a major economic driver of the Australian economy and contributes around $60 billion a year right now. A third of Australia's population live in regional or remote Australia, where those communities rely predominantly on the agricultural sector for their livelihood, as do many urban businesses and residents. The farming sector is also vulnerable to both fluctuating markets and variable weather conditions. This was no more evident than between 1998 and 2008, when the decade-long drought brought many farmers, including cattle farmers, to their knees. Coalition members conveniently forget that the long drought did more harm to most of the cattle growers than did the suspension of trade with Indonesia. They seem to have a memory lapse with respect to that, but I can say to coalition members: at the time, I spoke to many cattle farmers, who came to Canberra from around Australia. The drought was hurting them just as it was hurting farmers across the nation, and quite substantially. In the same way, coalition members pretend that the global economic downturn never really happened—until, of course, it suits their argument to say otherwise.
The Regional Investment Corporation Bill sets out the framework for establishing a government corporation—a quasi government bank—that will provide up to $4 billion in concessional loans to farmers or repayable grants to fund national water infrastructure. In keeping with the corporation's bank role, the skill set required of the three board members who will oversee the corporation include banking and finance, economics, financial accounting, and auditing.
As the name of this legislation clearly implies, this proposal is focused on supporting regional communities. Yet, when the Rudd government proposed a similar initiative, in partnership with the four major banks, to support the construction industry during the global financial recession years, coalition members ridiculed and opposed that proposal. How different is this proposal to that in terms of its objective? Indeed, that proposal was a partnership with the four major banks, who would have had a direct say in how the loans were made. Again, the double standards and hypocrisy of government members are evident.
Likewise, when Australian manufacturing industries were struggling, largely because of a very high Australian dollar, the Abbott-Turnbull government failed to intervene. In fact, the coalition government did the opposite, by taunting GMH to leave Australia, knowing that Toyota would follow suit and, in turn, end Australia's auto manufacturing industry. It was the most callous decision of the coalition government. It left Australia as one of the only advanced countries without a car-making industry, it left tens of thousands of Australians out of work and it left whole communities reeling. More Australians will lose their jobs over the coming months as the car makers finally close down their operations in Australia. The stupidity of that decision is that the loss of tax revenue to the government and the welfare payments it now has to make far exceed the assistance car makers were asking for at the time. Just as regrettable, the Australian dollar subsequently fell, as expected—which, once again, makes Australian car makers very competitive. Had the Australian dollar at the time been what it is today, perhaps the decision would have been different. Members opposite, who know nothing about the car industry, should think carefully about their comments with respect to what provoked GMH into leaving Australia.
I note that the member for Calare, in his contribution, lamented the loss of jobs from the closure of Electrolux. He, understandably, alluded to the devastating impact on the local community. I can relate to that impact, because it's happening in my own community. Yet there was no such compassion or care shown by members on his side of politics for the jobs of the auto workers in Adelaide and in Melbourne. They too have families and they were also working in factory jobs, just as the Electrolux workers were. I don't criticise the member for Calare, because he was not in this place at the time. But he makes the very same argument that members on this side of politics made in respect of the auto industry, which fell on deaf ears when it came to coalition members. The double standards are breathtaking.
My concern is not with the intent of this legislation but with the framework under which the corporation is being established and the influence of the minister in the role of the corporation. I note that both the Minister for Agriculture and Water Resources and the Minister for Finance have joint responsibility for the corporation. The reality is that this legislation is being driven by the agriculture and water resources minister, who will use the corporation for political pork-barrelling and to shore up seats in parliament for his side of the House.
I note that the corporation's headquarters will be in Orange, in the National Party seat of Calare. We're not told why Calare was chosen as the seat where the headquarters would be based, or why Orange was chosen. While I make no criticism of that choice, it would have been good for the minister to have come in and said, 'Yes, we looked at a range of sites, and for these reasons the headquarters will be based in Orange.' But we were not told. It was a decision made by the minister, who, under this legislation, has the power to do so. I have no problem with decentralising government operations from capital cities. But, again, I have no doubt from my travels around the country that there are many regional centres that would dearly love government operations to be established within them. If we're going to do that, at least let's look at it in a balanced way and then come back with justification for the decisions made by the government such as this one. But, yet again in this case, we are not told why Orange was chosen.
The more serious concern, however, is section 11 of the bill, which identifies the operating mandate for which the minister has responsibility. It is a mandate which includes, firstly, the eligibility criteria for loans and financial assistance. I will just repeat that: the eligibility criteria for loans and financial assistance rest with the minister. It includes 'directions on other matters'. It doesn't tell us what the other matters might be; it just leaves it open-ended. It is whatever the minister wants to give directions to the board about. And it includes the performance of the corporation, which effectively says to me that, if the minister doesn't like the direction that the corporation is headed, he can simply do away with the board and replace it. The mandate will be—and this is even more concerning—by way of a non-disallowable instrument. In other words, parliament doesn't get to see the mandate and cannot reject it if the mandate does not appear to be reasonable.
These powers give extraordinary control over the corporation to a minister who has shown his preparedness to pork-barrel and, even worse, his bias towards farmers in his part of Australia. We saw that with his handling of the water portfolio, which includes the Murray-Darling Basin. Firstly, the minister abandoned the return of the additional 450 gigalitres of water to the environment. We had a debate about this only the other day. But, even worse, when allegations of theft of one billion litres of basin water were made, he downplayed the seriousness of that. He refused to support a judicial inquiry into the claims, knowing full well that only a judicial inquiry would get to the bottom of the facts in respect to the claims being made because none of the other government departments or bodies that have been asked to look into the matter have the powers to do a full investigation and ensure that all the matters are addressed. Simultaneously, the minister says he wants a $4 billion bucket of money to build water infrastructure, while he shows little concern for alleged water rustling, as I call it, or water theft taking place under his very watch. He shows little concern for delivering on the Murray-Darling Basin Plan. He wants money because he argues that the nation needs to do more about storing water and having water available for our farmers when they need it. Yet, under his very nose, there are allegations that water has been taken away and he shows very little concern about that.
In closing, I support the amendment moved by the member for Hunter, and I do so because, as the member for Hunter quite rightly points out, this proposal comes at an $81.4 million cost to Australian taxpayers. There is no new money, as far as I can ascertain, in respect of the $4 billion. It is just a collection of money that will then be put into the hands of the Minister for Agriculture and Water Resources so that he can use it as he sees fit. It gives extraordinary control to a minister of government who has shown not only his preparedness to politicise his portfolio but his incompetence in managing the water portfolio. Yes, we need to support our farmers. The money that is being proposed under this legislation is already there. It's just a question of who decides which farmers get the support.
I join Labor members in this House in opposing the bill that's before us and in supporting the second reading amendment that all words after 'that' be omitted to insert the words 'the House declines to give this bill a second reading as it places the government's political interests ahead of the interests of Australia's farmers'.
We have a bill before us where we don't know if the person who has moved it is allowed to be a member of this place. We are currently debating a bill which, because it's opposed, will come to a division, and, therefore, the House—now with its eyes wide open, having carried a resolution on Monday—will be voting on legislation where we don't know whether it has been lawfully moved, and the person whom we don't know is lawfully here will turn up when the bells ring to vote on it. This is unprecedented in Australia, completely unprecedented.
We have continued to ask the government with respect to bills like this, with respect to who is the sponsor of the bill and with respect to divisions, to follow the practice that has been adopted in the Senate. The practice that has been adopted in the Senate for Senator Canavan is that he has stood aside from his role. He may end up being cleared by the court, and then I expect he will come back. But, in the meantime, he has stood aside and has decided to not participate in votes until the High Court has concluded deliberating on that. We have asked for nothing less in this House. There is nothing that we can do that will stop the government from persisting with what they do today. But I would advise the House that, if we are still in this extraordinary situation in two weeks time, when we come back on 4 September, there will be a motion on the Notice Paper at that point.
If we are still in this situation when we return, there will be a motion on the Notice Paper that would deal with the problem we're facing with the legislation that's in front of us right now. It would simply have the House resolving that, on anything where a division is called, where there is not agreement on both sides of the House—on national security issues, for example, we usually don't have divisions; we get agreement so the House is able to do its business—the decision on how that division is resolved would be deferred until after the Court of Disputed Returns had returned its decision, following its meetings, based on the resolution that we had on 14 August.
That would be a way of avoiding what's in front of us right now with this bill. I would rather the government simply did in the House what they would do on this bill in the Senate. The minister there who has been referred to the High Court has stood aside from his ministerial role and won't participate in the vote. The same should be happening here. If that has not been resolved by the time the House returns in September, then we will have before us a question on the Notice Paper simply asking that all divisions be deferred until the High Court has resolved this matter. I accept and appreciate that there is government business that needs to be done, and I support that. But I don't believe we can be in a situation where bills are being sponsored by somebody where we don't know if he's legally allowed to even be a member of parliament, and, when they come up for resolution, he's turning up for the vote.
I welcome the opportunity to speak on the Regional Investment Corporation Bill 2017, as this bill delivers on our commitment to establish the Regional Investment Corporation. We're establishing the corporation because we recognise the enormous contribution that regional and rural communities make to this nation. Agriculture is playing a more crucial role than ever in this nation's prosperity. The value of Australia's farm production and farm exports is estimated to be breaking records in 2016-17. This is why I believe an investment in our farmers is an investment in our nation's future. For our agricultural sector to reach its full potential, we need strong, resilient farm businesses that can seize opportunities in a competitive and ever-changing environment. We also need to have the right water infrastructure in place, so that agriculture can expand and further increase its productivity.
The corporation will support both these goals. The corporation will improve the delivery of the Commonwealth's farm business loans. It will remove the states as the middleman, allowing us to be more responsive in providing loans to farm businesses. We will also be able to deliver a nationally consistent program focused on the needs of Australian farmers. The corporation will be offering a new, expanded farm business loan program. Its loans will give viable farm businesses in hardship a hand-up to take advantage of the opportunities available to diversify and strengthen the markets that they supply. They will also boost farm productivity and cash flow, and provide positive economic and social flow-on effects for regional Australia. The corporation will also administer the government's National Water Infrastructure Loan Facility. Water and water infrastructure are critical to our future prosperity, particularly for agricultural industries and regional areas of Australia. The corporation will provide independent expert advice to the government on water infrastructure projects. The projects funded through the facility will help our agricultural sector achieve its full potential.
To conclude, the corporation will make a significant contribution to building stronger and more prosperous rural and regional communities. Its loans will help farm businesses build and maintain diversity in markets they supply and take advantage of new and emerging opportunities across Australia and overseas. It will also help fast-track the construction of priority water infrastructure needed to stimulate investment, economic growth and increased agricultural productivity in rural and regional Australia. Time and time again, this government has proven its commitment to backing our farmers, because we know that agriculture has been and will always be an integral part of our nation's prosperity. I will be introducing amendments shortly, but I certainly commend the bill to the House.
The original question was that this bill be now read a second time. To this the honourable member for Hunter has moved as an amendment that all words after 'That' be omitted with a view to substituting other words. So, the immediate question is that the amendment be agreed to.