Thursday, 20 March 2014
Farm Household Support Bill 2014, Farm Household Support (Consequential and Transitional Provisions) Bill 2014; Second Reading
I rise to speak to the Farm Household Support Bill 2014 and the Farm Household Support (Consequential and Transitional Provisions) Bill 2014. I indicate at the outset that the opposition is in full support of this legislation. I would like to speak briefly to the background of the legislation and why we are supporting this bill.
The bill provides the mechanism to implement the Farm Household Allowance—up to three years or 1,095 days income support payment—and ancillary benefits for farmers and their partners who can demonstrate financial hardship without the need for a climatic trigger. The Farm Household Allowance is to commence on 1 July 2014, and is set to replace the Exceptional Circumstances Relief Payment, otherwise known as ECRP, which was only available to regions declared to be in extreme drought.
The bill also acknowledges that the government has implemented the Interim Farm Household Allowance, otherwise known as the IFHA, from 1 March, and allows for the transfer of existing support scheme recipients to the IFHA. In addition to income support, the bill provides for the provision of farm financial assessments to assist farm businesses to plan for the future. It requires income support recipients to enter into, and comply with, financial improvement agreements to qualify for payment.
The companion bill repeals the Farm Household Support Act of 1992 and amends other acts. Together, these bills deliver a new legislative scheme to deliver income support to farmers and their partners who are experiencing financial hardship. The bill in fact delivers on what the previous Labor government committed to under the Intergovernmental Agreement on the National Drought Program Reform, the IGA, and provided a new nationally-agreed approach to drought programs including time-limited income support payments for farmers and their partners based on individual need. This agreement was achieved by the previous government on 3 May 2013 at the standing committee on primary industries meeting. Further to the FHA, the IGA also includes Farm Management Deposits scheme and taxation measures, a national approach to farm business training, a coordinated and collaborative approach to the provisions of social support services, and tools and technologies to inform farmer decision making.
The Labor Party supports the bill, but we have been critical of the Abbott government's slow response to the current drought. It is a bit like their slow response to opening up South Australia to mining, as I noted earlier. This is another example of a slow response by this new government. This bill should have been introduced much sooner to enable a more timely assistance to struggling farm families who have been suffering for some time. Labor is further critical of the Abbott government's decision to abolish a key COAG vehicle, SCOPI, in December 2013, which was working to progress drought reform. Labor will hold the Abbott government to account in progressing a long-term drought policy and calls on the government to reinstate the SCOPI, the Standing Committee on Primary Industries. Long-term drought reform, which was led by Labor in government, has not been progressed in the way it should have been by this government in six months, but we do support this bill.
I am very grateful to Senator Siewert for giving me an opportunity to make a very short contribution ahead of her because of a committee commitment I have. I indicate that, of course, I support this bill. It offers a new way to identify and assist farming households which are under financial pressure.
While most of the attention has fallen on that large swathe of the country experiencing drought, attention must also be paid to the many small wine grape growers in my state. You cannot make wine without grapes but, as with so many primary producers, wine grape farmers are again being taken for granted. Many are being forced to take prices well below the cost of production. The plight of these farmers must not be forgotten during the roll-out of this bill. I had a constructive discussion with Mr Barnaby Joyce, the Minister for Agriculture, who assured me—and his office assured me—that this package of measures is not confined to those who have been directly affected by the drought that is continuing in many parts of the country. It applies more broadly, and so those farmers have an opportunity to apply for assistance.
Whether in the Riverland, the South East, McLaren Vale, Adelaide Hills, the Barossa or any other wine region in South Australia, wine grape growers are the backbone of the wine sector and many of them are doing it extremely tough. I have met many of them; they contact me regularly; their stories are quite disheartening, but I believe there is hope for the industry in terms of increasing export markets, which will in turn increase demand for Australian grapes.
The very large 2013 wine grape vintage in Australia has been impacted on heavily this year. Prices have dramatically reduced and the level of production is expected to exceed total sales by 15 per cent. The Australian's Pia Akerman reported this month that prices have dropped by 30 per cent for Riverland grape growers, and I understand that in Sunraysia and in the Riverina there are similar stories. This year, just like the very bad drought being experienced in other parts of the country, the prices faced by wine grape growers are very dire. In other words, there is a significant economic impact on them. Many of them are already saddled with debt burdens run up trying to keep their vines alive during the harsh years of the last drought. In a sense, they are also affected by drought, but this is a drought that broke several years ago, though the financial impacts of that are still felt strongly.
When the Prime Minister announced this package of measures, which I strongly support, he said that this was a response to farming circumstances outside the 'ordinary variation in the business cycle'. He wanted to assure all Australians that:
… this government intends to stand by people in need. We intend to stand by people in good times and in bad.
I support those comments and I simply say that at the moment in South Australia there are many wine grape growers who are doing it very tough, and hopefully this package will support them to some extent, but we need to do more for those wine grape growers in the coming months.
I rise to contribute to this debate on the Farm Household Support Bill 2014 and Farm Household Support (Consequential and Transitional Provisions) Bill 2014. The Greens support urgent financial support for farmers and welcome the provision of critical mental health services to regional areas. However, we do not believe that the bill has been designed to help farmers in the long term. Here I am talking of—and I have touched on this previously—the impact of climate change. We are acting as if climate change does not exist and is not going to have an impact on farmers and growers into the long term.
Senator Milne has circulated a second reading amendment, and on behalf of Senator Milne, I move that amendment, which seeks to:
At the end of the motion, add:
"and, given the scientific evidence of changing precipitation patterns and extreme weather events, like heatwaves and droughts, becoming more intense in Australia because of climate change, the Senate calls on the Government to expand the existing National Disaster Resilience Program to include a provision for drought assistance."
This second reading amendment acknowledges that drought fuelled by global warming is not a one-off problem. The future of farming families depends on addressing our changing climate within any drought package. We need to be acknowledging it now so we can deal with this problem that is only going to get worse.
The Greens are proposing a stronger and permanent disaster resilience fund that would do more to help in drought, which affects farmers so badly, than a one-off drought relief response, which we keep doing. We need to be doing long-term planning to address the ongoing issue of the impact of climate change in more and more severe droughts.
Any drought plan needs to help farmers who are struggling today and needs to ensure that there is a long-term strategy in place to provide for the reality of a warmer, drier climate. Extreme weather conditions and natural disasters like droughts, heatwaves, floods and bushfires hurt those who rely on the land for their livelihood across Australia. With the Bureau of Meteorology declaring 2013 Australia's hottest year on record, with extreme weather conditions expected to become more frequent, we can expect to have much more intense droughts as the ambient temperature continues to rise. Climate change will cause bigger falls in crop yields than has been previously estimated. This will exacerbate food insecurity. A new study has been looking into this. The research which was conducted by Australian, British and American scientists found that the situation will worsen in the second half of this century, with tropical areas hit worse than temperate regions. We also need to bear that in mind when we are talking about developing the north.
It is absolutely critical that, if we want sustainable agriculture and want farmers and growers on the land, we address this issue now and do not pretend that these are just one-off events, because they are not. We should be recognising that. We do our growers and our famers a huge disservice by not making sure that, as well as helping with the most immediate problem, which of course we have to, we need to plan our response for the long term and not bury our head in the sand. A classic example is in Western Australia. We had a bumper yield this year, but we still had some farmers in the north-east region of the wheat belt who suffered from drought and did not put a header into the crop. We need to recognise this issue and we need to help now because if we continue to ignore it we are just going to see more and more farmers leave the land. As the CSIRO said in their report released last month, climate trends are changing agricultural regions. They are transforming them, it said. We need to transform our agriculture and recognise that, which is why we need a longer term strategy.
In the study that the Australian, British and American scientists undertook, they carried out an analysis of more than 1,700 simulations. They found that across all regions and all crops, including wheat, maize and rice, yields will drop by two per cent each decade based on a two-degree rise by 2050. Just last week, the UNFCCC workshop report on the adaptation of the agricultural sector highlighted the need to adapt our agricultural practices and technologies to build in more climate-resilient agriculture and allow for sustainable agricultural production. Many parties at the workshop emphasised that there is an immediate need and priority for the adaptation of the agricultural sector to climate change impacts. Water deficits and droughts significantly decrease agricultural production. Addressing the issue of drought, many parties provided information on the establishment of services for seasonal climate forecasting, drought monitoring or drought early-warning systems as elements of their adaptation practices in agriculture. Several parties also emphasised the importance of an understanding of the long-term macro-level impacts of climate change in order to develop national extension plans to train farmers. The activities that were highlighted in the workshop are just as relevant here as anywhere else on the planet. It is absolutely essential that we start putting in place these practices.
While the package that we are debating and supporting through this chamber today is important and essential, I do not want to be back here in a couple of years having to do exactly the same thing—this package on hormones—because we have more farmers in trouble and we have to put in place more ad hoc measures rather than doing this according to a strategy where we sit down and work it out now. Our farmers need to be confident that we do have the adaptation plans in place and that we do have the research and development done to assure them that they have crops that will grow in a drying climate and they have production systems. They may look slightly different or quite a lot different because, as CSIRO said, climate change will transform our agricultural regions. Therefore we need to transform our agriculture. If we do not ensure that we have those measures in place, we are failing agriculture and we are failing our farmers and our growers, and this is across the broad, in agriculture, horticulture and viticulture. We need to put this strategy in place and we need a disaster resilience fund and program so that we can have the funding in place to support growers in the face of the impacts of global warming on their land use, their farms and their production. We are failing our farmers if we do not.
The Farm Household Support Bill 2014 and the Farm Household Support (Consequential and Transitional Provisions) Bill 2014 enact the Farm Household Allowance and replace the Farm Household Support Act 1992 and its outdated support measures. Introducing these bills confirms the government's commitment to help farm families in financial need, regardless of the cause. This is a permanent safety net available at all times, including when extreme weather events such as drought take their toll on farm income. It delivers genuine reform of government support for farm families and provides assistance and support to improve their long-term financial situation. It will provide eligible farmers and their partners with up to three years of payment, paid fortnightly at a rate equivalent to Newstart allowance or Youth Allowance for those under 22, a healthcare card and a range of other supplements, including up to $1,500 for a farm financial assessment and up to $3,000 to implement a financial improvement agreement. This will give farm families time to get back on their feet and the opportunity to take steps to improve their circumstances.
For those families in hardship now, who cannot wait until the commencement of the legislative allowance on 1 July, the government has brought forward the main eligibility requirements and introduced them through the interim farm household allowance. The interim allowance is an executive scheme that is already delivering support to those who need it. Already 249 applications have been received and 83 claims granted. The allowance forms a major part of implementing the intergovernmental agreement on the National Drought Reform Program, which was agreed by the Australian state and territory governments in May 2013. This national agreement recognises the importance of encouraging farmers and their families to manage risks and prepare for challenging times, including as a result of climate variability.
I remind the Senate that the farm household allowance is an uncapped, demand-driven program. This means no-one in need will be turned away by an arbitrary funding cap. I note the second reading amendment moved on behalf of the leader of the Greens, which calls on the government to expand the existing Natural Disaster Resilience Program to include a provision for drought assistance. While it is good to see the Greens supporting measures that could help farmers become more resilient, this is provided for separately under the May 2013 intergovernmental agreement that I just mentioned. The IGA aims to, among other things, assist farm families and primary producers adapt to and prepare for the impacts of increased climate variability and encourage farm families and primary producers to adopt self-reliant approaches to manage their business risk. It also provides a framework, the jurisdiction, to respond to needs during periods of drought. Putting drought assistance under the National Disaster Resilience Program is not appropriate, given drought programs are specifically provided for under the drought IGA.
Moving back to the legislation at hand, the second bill in the package, the Farm Household Support (Consequential and Transitional Provisions) Bill 2014, will repeal the Farm Household Support Act 1992 from 30 June 2014 and amend legislation required for the operation of the farm household allowance. The bill includes a provision to enable a smooth transition for recipients of the interim farm household allowance who wish to apply for the legislated farm household allowance. The farm household allowance will improve outcomes for farm families through personalised support and financial assistance to develop skills or retrain. It will strengthen the government's support for farmers and, through them, rural and regional communities across Australia. The support these bills have received demonstrates that this is good policy as well as good common sense. I commend the bills to the Senate.