Primary Industries Research and Development Amendment Bill 2017

Primary industries, as you know, Mr Deputy Speaker Hogan, have always been an essential part of the Australian economy. From our early history of Australia riding on the sheep’s back, our primary industries have innovated, changed and grown exponentially. A critical part of this growth has been investment in research and development, as well as in extensive marketing.

As a farmer myself, I know that it is one thing to produce a product; it is entirely another to find profitable long-term markets for that product. This is why trade and our free trade agreements have been, and will continue to be, so important to the primary production sector. When we look back to what’s been asked of us as a government repeatedly, it’s been the No. 1 issue that farmers have raised—the market access issue.
Some of the challenges for those of us who are farmers and primary producers is to continue to extend Australia’s competitive edge in the global food and fibre market; to tackle challenges such as competition in both domestic and export markets; the employment in our towns that goes with our primary production; and the long-term impacts of the change of climate on ag productivity and sustainability.

The Australian Bureau of Agricultural and Resource Economics and Sciences forecast our farm exports at $48.7 billion for 2017-18. It’s a massive earner for our country. And you know very well, Mr Deputy Speaker, how it underpins so many regional communities—the small businesses and local economies right around Australia. Since 1945, when the government established ABARES, we have seen increased productivity—constant increases, constant innovation and some amazing farmers. They are some of the best in the world, without a question. This is mostly because of continuous research and development.

There are industry-specific development corporations, as we know, from the Australian Egg Corporation, Meat & Livestock Australia and Horticulture Innovation Australia to the very well-known Australian Wool Innovation and many others. These corporations also have a marketing function. And the R&D isn’t just into more efficient ways to produce their respective commodities but also into the marketing of the products. Relevant industries invest in their R&D corporations through levies on the production itself, and the Australian government invests by matching the industry R&D levy expenditure. It is a real partnership and a unique model in Australia and in the world.

According to ABARES estimates, for every dollar invested in agriculture R&D our farmers, our primary producers, actually generate a $12 return within 10 years—for every single dollar. It’s a great return on investment: strong agriculture, fisheries and forestry industries are a massive benefit for all Australians and underpin so many of our rural economies, as I said. It is those local jobs and small businesses.

As I mentioned earlier, there are 15 rural R&D corporations. Out of those 15, 14 can carry out marketing activities but only 10 do. They provide a very valuable service to their industry sectors in both R&D and marketing. This has helped to build our pork, wool and red meat industries, for example, and expanded Australian access to international markets. This is particularly relevant with the free trade agreements delivered by this government with Japan, Korea, China, the Trans-Pacific Partnership, Peru and Singapore.

The coalition government has worked hard to open international markets for access by our primary producers. As I said, the most common thing said to me—and to you, Mr Deputy Speaker—was about markets access, ‘We just want a fair go into the market.’ That’s what this government has worked over time to deliver. I’ve said previously, and I’ll say it proudly every single time: our primary producers in Australia are some of the most efficient in the world, in spite of operating, often, in much harsher and more extreme weather and growing conditions than many of our international competitors.

Much of that capability and capacity to manage environmental challenges comes from continuous research and development. For instance, Dairy Australia is an R&D corporation that defines its role as:
… to build a sustainable and internationally competitive industry and to provide solutions that help farmers adapt to an ever-changing operating environment.

That’s the world we live in. It doesn’t stand still for us on the farm. And it acts as the collective investment arm of the dairy industry and invests in research, development and extension as well as industry services.

In my electorate of Forrest, Western Dairy assists farmers with many programs made possible from R&D contributions. Western Dairy helps farmers with programs in relation to compost, financial analysis and farm safety, as well as one called Stepping Back, which assists farmers in transitioning and setting up for the next generation of farmers, which is really critical in this space.

Australia’s rural and ag sector employs more than 1½ million people. The overall ag supply chain contributes 12 per cent to Australia’s GDP. And I really like this statistic: each year the average Australian farmer feeds 600 people. What a great achievement. We feed 600 people, each person. And I think that’s often overlooked. Innovation, agility and efficiency are critical to our industry. Strategic, targeted and regionally relevant research and development is the key to that, as is the collaboration, the extension onto farm, between researchers, investors, governments, primary producers and agribusinesses—that direct return beyond the farm gate itself. In 2015 Deloitte said that agribusiness is ‘the sector with the strongest competitive advantage for Australia’s outlook’, as well as the benefits of R&D flowing directly to farmers and regional state and federal budgets. That’s what it does. It doesn’t just sit with the farmer; it flows right across the board. It flows down to help provide innovative, cutting-edge education for our agricultural students, which is one of the reasons I cannot understand the WA state Labor government, which announced $64 million in education cuts, some of which they’ve had to reverse because of public pressure. The CWA actually marched on state parliament recently and protested against those sweeping cuts to regional education.

But the one that I really believe is so retrograde and negative—the most blatant and ill-conceived cash grab—is taking 20 per cent of funds from the Agricultural Education Provisions Trust fund. This is physically taking funding from our agricultural colleges and Esperance Farm trainee school in WA. These funds are earned by the schools themselves and generated from selling their own produce. The Harvey ag school in my electorate is a fantastic facility, but they’re going to lose at least $50,000 every year. These are the funds that the ag schools use for farm machinery, for developing their farms and applying the latest innovation and technology, and for repairing and replacing fences, as well as the constant recurrent costs that they have to meet. So Labor’s cutting hundreds of thousands of dollars from these regional ag schools.

I have no doubt—and I’m sure there are members in here who have no doubt—that agriculture is critical both to the WA economy and to the Australian economy. In WA alone it’s worth $8.6 billion—just to the WA economy. And the expectation is that that could double over the next 12 years as our beef, lamb, wine, beer, dairy, fruits and vegetables, seafood, pork, wheat and grains are marketed overseas in high-end products. That’s where we belong, at the high-value end of niche products, because we have fantastic quality. And we should never underestimate that and its impact around the world.

Our farmers and our primary producers work very closely together to get these products to the markets, and our future farmers need the best possible education, with the most current innovation and training technologies—the machinery, the tools and trades equipment—like that at the Harvey ag school’s trade training centre. It is exceptional. The students currently have access to well-equipped workshops. They’re training on the machinery and tools currently being used in the relevant industry, whether it’s automotive, construction, furnishing, metals or engineering. But also, as you would know, Mr Deputy Speaker Buchholz, the ag school is an economic contributor in itself to our local Harvey community—in employment, in sourcing inputs from local businesses.

Over 600 students attend these colleges. What this tells me is that, unfortunately, the WA state Labor government just don’t understand the constant changes that occur in the ag sector. They don’t understand why our ag students need access to cutting-edge farm machinery, technology and equipment, and that’s delivered not only by continuous research and development but by access to funding to keep upgrading what they have at their disposal to teach great young people. But mostly what is worrying is they don’t want to invest in the future of agriculture for the next generation. What sort of a message does this give to the great young people who want to go into agriculture and see a great future? And this is in a state that is set to double its population by 2050.

For farmers, constant innovation, constant focus on quality is what we do. It’s what helped to keep us competitive and we are constantly improving our efficiency and productivity. We know that 58 is the average age of farmers in Australia. That’s why these young people at the ag colleges in Western Australia are so important. We actually need every single one of our new young farmers. So I say to the state Labor government: cutting funding from Western Australia’s agricultural colleges is a short-sighted city-centric decision. Continuous R&D and marketing are the keys to being competitive.

This legislation deals with the four statutory R&D corporations that are still governed by the 1989 legislation—the fisheries, cotton, grains and rural industries R&D corporations. Like most of the R&D corps, they must have a statutory levy attached in order to undertake marketing. This change was made in 2013 following wide consultation which led to the passage of the Rural Research and Development Legislation Amendment Act 2013. The process to impose a statutory levy is often time consuming and its collection can be expensive. The fisheries R&D corporation and its industry body say the smaller industries can’t afford the cost of establishing and collecting a levy, so this bill will make it possible for the fisheries, cotton, grains and rural industries R&D corporations to carry out marketing activities by using voluntary contributions—for example, a gift, a grant or a bequest. It simply updates the legislation and puts these four corporations on the same footing as the other corporations.

The bill also requires the R&D corporations to report on the marketing activities that they carry out each financial year in their annual report. This will ensure transparency for the industry, and the bill expands the definition of marketing activities to include matters that are incidental to marketing. This will allow the R&D corporations to plan and to coordinate marketing activities using the funds provided to them for R&D purposes.

In finishing my remarks today, can I just give a great shout out to every farmer, every primary producer that’s out there in Australia. I have enormous respect for my fellow farmers. I’m very proud of them. On Saturday evening, I attended a Dairy Industry Association of Australia event where the DIAA award winning products were celebrated. There were some fantastic products from right around Western Australia. But what I did do, which will be of no surprise, is remind those great small, medium and large manufacturers in Western Australia that we are interdependent—me and my family as producers of some of the best quality milk in Australia and they as manufacturers. We work together to produce some of the best quality dairy products in the market. I’m hoping they in turn take advantage of the fantastic free trade agreements that we’ve signed and look at how to not only to get their products well established in the domestic market but actually get them into the wider international markets as well. We can compete anywhere in the world with our great farmers and our fantastic manufacturers, and I just urge them to get on with it.