SUBJECTS: Drought Communities Program; Government Embellishing Drought Funding Numbers; Dairy Code of Conduct; Carbon Emissions Policy
DAVID SPEERS, HOST: In Parliament this afternoon, Labor was focused on the drought once again, in particular the fact that drought-affected farmers can only access Farm Household Allowance for four years; they now get a lump sum payment at the end of that four years. But the Shadow Minister, Joel Fitzgibbon, raised these figures:
*Audio from Question Time*
JOEL FITZGIBBON: Can the Prime Minister confirm that his government has kicked 600 farming families off the Farm Household Allowance as the drought worsens, and will kick another 500 families off the payment by Christmas?
SCOTT MORRISON: We will continue to monitor this issue very closely, Mr Speaker, and on each occasion we have responded to the advice we have received on the Farm Household Allowance remembering it started at three years forever. It is the first and the biggest call on the pressures on our budget as we consider the issues whether it we go into the MYEFO period or next year’s budget. The first thing I am going to ensure is addressed is to meeting the needs of our drought support programs, Mr Speaker.
SPEERS: The Prime Minister there answering Joel Fitzgibbon’s questions and giving what very much sounded like a pretty strong hint that more support will be on the way in that mid-year budget update in December. Joel Fitzgibbon joins me now, thanks for your time. Is that how you read those comments?
JOEL FITZGIBBON, MEMBER FOR HUNTER: Yeah it looks like, David, there is something more coming and I say thank goodness for that because the main thing to come out of Senate Estimates over the last two days is a confirmation that he has been massively embellishing or exaggerating the amount of money they are spending on drought. He keeps repeating this $7 billion figure, and I’ll be pretty generous and give them $1 billion, and I think it’s short of that, but to raise false hope and to mislead devastated farming families with that ongoing fib is just very unfortunate.
SPEERS: Can I go to the point you were asking about there, these figures 600 families have lost their Farm Household Allowance? So they’ve used up the four years?
FITZGIBBON: Yes the four years.
SPEERS: Right and you reckon another 500 will lose it by Christmas?
FITZGIBBON: And by the Department’s own admission, yes that’s true.
SPEERS: So is your position they should continue to receive that income support while ever they are in a drought declared area?
FITZGIBBON: Yeah. I think whenever this drought is ongoing they should continue to receive that support. Remember that these are the hardest hit drought-affected families. This is a really hard payment to secure in the first place and it’s been too hard for very many farming families. These people should be just left on it; it’s putting food on the table and maybe giving them a little bit of cash flow just to keep the farm business going until we get to the other end of this drought.
SPEERS: The government is pretty reluctant to do that, and even the National Farmers’ Federation doesn’t think that is the way to go. Do you accept that some farmers resent when they’ve done the work to be efficient and make it through the drought and others haven’t; do they resent that you think?
FITZGIBBON: Well I think the National Farmers’ Federation should start standing up for its members. Now I do accept the policy rationale behind the time limit and in fact right back in 2012 when signing the original intergovernmental agreement, States, Territories and the Commonwealth, and all political parties, agreed that it should be time limited so farmers…
SPEERS: Back then it was what, three years?
FITZGIBBON: Three years, and the idea was that farmers use those three years to either adjust their business model or to get out.
SPEERS: So what’s changed now, the severity?
FITZGIBBON: The severity of the drought. I keep saying that the test of viability is important. Look, there are some farmers, for many other reasons but including dryness and heat, are moving from the marginal column to the inviable column. But the test viability is not whether you can make it in the eighth year of drought, David. There are farm businesses that would be viable if the drought only lasted six years, but you know eight years shouldn’t be the test.
SPEERS: But if you make it ongoing then you are supporting subsidising unsustainable farming; you don’t think that is the case here?
FITZGIBBON: There is often a moral hazard in public policy, including in drought policy, but again if I thought there were people out there that weren’t up to surviving six years, then that would be a different question. But the idea that you can’t make it in to the eighth year or ninth god forbid, you’re not viable is wrong. I mean these people produce our food; we need them to stay on the land. I mean, this is fast becoming not just a crisis for farmers and rural towns, this is starting to threaten our food security and of course we saw Kellogg’s make the decision to put their cereal prices up. You can expect to see a lot more of that, and if we lose more people off the land, well if Scott Morrison continues to force people off the land by taking their payments off them, that will make the matter much worse.
SPEERS: Can I ask you about the dairy industry – a few grumbles in the National Party today about this amongst other things – about the dairy industry Code of Conduct which we are told by Bridgette McKenzie will now be produced by the end of this year after pressure from One Nation. You must welcome that though? You’ve been after this Code of Conduct for a while?
FITZGIBBON: Yeah I have, David, and the dairy industry was in a lot of trouble before the drought became really bad. They’ve been caught in a cost-price squeeze for a long time there. Their input prices are going up and of course they’re being squeezed on the price they receive from the processors, which in turn is a result of the supermarket problem. So, we needed this a long time ago, the ACCC had an 18 month long enquiry and recommended the mandatory Code of Conduct – I think it was October 18.
SPEERS: And what does it need to include because there is a lot of opinion on this? Should there be a floor price on milk?
FITZGIBBON: It’s a separate thing. We went to the last election promising to task the ACCC with an enquiry into the efficiency of introducing – the effectiveness of introducing a minimum farm gate milk price. Either that was a great policy…
SPEERS: And you stand by that?
FITZGIBBON: I still stand by it. We cannot – you know, throughout that period there was a fair bit of public discussion about my policy proposal and people saying that’s going to affect our export markets and I said, you know, if we are in export markets – if we can only compete in export markets by paying our dairy farmers at or below cost, well we shouldn’t be in those export markets. So, it’s not very difficult – processors do it now – it’s not very difficult to work out in each particular sub-region what is the average cost of producing a litre of milk, then you set a minimum price just above that, not too far above it but enough to allow them to turn some cash flow and further invest and improve their productivity.
SPEERS: What about reregulating the industry as Pauline Hanson suggests?
FITZGIBBON: Well, what does reregulation mean? I mean I could argue that the introduction of a mandatory milk minimum price is a form a reregulation. Look, I’m working with Pauline Hanson on this. If I’m not able to help the dairy farmers alone, I’ll work with anyone prepared to. We saw the Nats and the Libs sit in the Senate last Thursday evening voting against the proposal to help our dairy farmers, and of course, as you know, that is causing a degree of disquiet within the National Party in particular.
SPEERS: Finally, you’ve coped a bit of pushback from your Labor colleagues on your climate policy position. Do you think we got a climate emergency?
FITZGIBBON: Look, climate emergency has become the international movements’ terms on describing the fact that so many countries…
SPEERS: Is it accurate?
FITZGIBBON: - countries are not. Well, it is building to a climate emergency. I mean, here in Australia…
SPEERS: But right now?
FITZGIBBON: - we know the link…
SPEERS: Are we in a climate emergency?
FITZGIBBON: Well I think when you got emissions going up every year, year on year for the last six years in Australia, and you know that you’re not on track to meet what the world agreed was the response you needed to keep warming at no more than two degrees, then at some point it becomes an emergency. Let’s show the urgency now.
SPEERS: Right now? I know you are not saying right now we are in an emergency.
FITZGIBBON: I’m saying we need to show the urgency now because we can’t just sit back, and that’s what I’ve been saying. We are in Opposition for three years. I want us to develop a strategy that forces Scott Morrison into turning that around over the course of the next three years.
SPEERS: Joel Fitzgibbon good to talk to you, thanks for joining me.
FITZGIBBON: Great pleasure David.