THURSDAY, 12 MAY 2016
SUBJECT/S: Murray Goulburn crisis; Live Trade exports.
JOEL FITZGIBBON, SHADOW MINISTER FOR AGRICULTURE, FISHERIES AND FORESTRY, SHADOW MINISTER FOR RURAL AFFAIRS: Im very pleased that Jaala Pulford and our Candidate in Corangamite Libby Coker could join me today as we try to learn from people on the ground about the real impacts of the dairy crisis and how we as Governments might work together to help people through this very challenging time. We are in Corangamite but of course this is not just an issue here. It's an issue in Wannan, McMillan and indeed many electorates throughout the State and my fear is that the milk price contagion will make this a national issue in a short time. Jaala, Libby and I have been talking to dairy farmers about their key issues and concerns and of course, how we might work together to help them through this difficult time.
Unsurprisingly, I have been critical of Murray Goulburn. I think that producers have been treated badly throughout the course of the last two weeks. I believe there are many questions to be answered and I am most disappointed that Barnaby Joyce has not been prepared to ask those questions. He is completely missing in action throughout this crisis. It has now been over two weeks since Murray Goulburn announced its new price regime to suppliers but Barnaby Joyces silence has been absolutely deafening. It wasnt all that long ago that Barnaby Joyce was running around talking up milk prices. Indeed, he was quoting $11 per litre of milk in China as if it was the new norm. He unnecessarily raised expectations.
Barnaby Joyce is very good at taking credit when things are going well but he goes completely missing in action when things are going badly. He needs to get down here to Victoria, to Western Victoria in particular and listen to the people on the ground and fully appreciate the impacts this crisis is having on dairy farmers right throughout the State.
JAALA PULFORD, VICTORIAN MINISTER FOR AGRICULTURE AND REGIONAL DEVELOPMENT: The Victorian Government is working very closely with the United Dairyfarmers of Victoria and talking to all players across the industry. We convened an industry taskforce a week ago, they are meeting again at the end of next week. In the first instance, our most pressing concern is around the welfare of Victorian Dairy Farmers. There are whole communities that have had their income decimated in the last couple of weeks and we need to be making sure that people have the support that they need in whats an incredibly difficult period. We have some conversations to have with the banks and look forward to further discussions with those processes about the support that they will be providing. But its really important also to be joined by Joel Fitzgibbon and Libby Coker today to hear directly from farmers in South Western Victoria, many young farmers as well, some of whom have been in the business for only two or three years and for whom this comes at a devastating time in the life of their business. So we will continue to work closely with the players in dairy farming who are impacted by this and with those who may influence a better response to this in Canberra. There are questions around transparency in the market that will continue to linger but in the first instance we want to know and understand this issue well and make sure that we are providing support through industry and otherwise to people who are experiencing really considerable hardship.
JOURNALIST: Mr Fitzgibbon, you have been very critical of the Government not stepping in, not doing anything. What place does the Government have in a situation like this? There has been some talk of regulation, reintroducing some regulation. Do you see that there is a prospect of that?
FITZGIBBON: Well, the best Barnaby Joyce has been able to do so far is to direct dairy farmers to the ACCC - he cant even get the regulator right. But I can just imagine the people that we met with this morning making their way to Melbourne or Canberra in this time of crisis, to knock on the door of the ACCC. Barnaby Joyce has shown no compassion or sympathy for those being affected but, you know, organisations like Murray Goulburn sit up and listen when a Minister speaks. No one knows that better than Jaala, but Barnaby Joyce hasnt spoken. He has a leadership role to play here, he should be talking to people on the ground like we have been today. He should be talking to the banks, he should have been more vocal in terms of ASIC. Ministers dont direct ASIC, but Ministers can make it very clear very easily what they believe ASIC, the regulator, should be doing. Barnaby Joyce could have done plenty by now.
JOURNALIST: What would you have done by now?
FITZGIBBON: Well, the first thing I would have done was yes - talk to Murray Goulburn - express my concerns. I would have urged ASIC to act two weeks ago now. I would have been in immediate contact with the State Minister to see how the State and Commonwealth can work together. I would have been urging the Board of Murray Goulburn to show some contrition, to admit that they got some things wrong, to show that they take responsibility for what has gone on in terms of their treatment of Murray Goulburn suppliers. There is much that Barnaby Joyce could be doing and I hope and trust that he does see a role for Government and today, as this issue continues to build is thinking about how the Commonwealth might work with the State to help the people on the ground here - because people on the ground here are facing a really desperate situation.
JOURNALIST: Do you think that there needs to be an inquiry?
FITZGIBBON: Some are calling for it. There is an inquiry and ASIC is holding that inquiry and I would never seek to pre-empt that inquiry, but I would be very surprised if ASIC doesnt find things that it finds of great interest.
JOURNALIST: Not just into Murray Goulburn, into the industry itself, farmers are saying that it shouldnt have got to this point, it needs to be looked at. The entire industry needs to be looked at. Do you think thats true?
FITZGIBBON: There is never anything wrong with asking the questions and I have no objection to an inquiry as long as we know what questions need to be asked. The people were talking to on the ground today potentially have the banks at their doors now. They cant wait for an injury. They needed at the very least, the moral support and leadership from the Commonwealth Government. No less than the Deputy Prime Minister, is the Agriculture Minister. The least he could do is get himself down here, show some support for the people and show some leadership.
JOURNALIST: There is a lot of talk about support and understanding and showing, any plan of action and actual policy or you know intervention from the Government or support packages that you would be delivering if you were in Government?
FITZGIBBON: Well, what I am trying to do is develop a package in cooperation with Minister Pulford. Monday evening, I met with the Australian Dairy Farmers. On Tuesday, I had a briefing from the Department of Agriculture in Canberra under the caretaker conventions. Today, Im on the ground listening and learning from the people most affected and we intend to go back to our respective offices to work together and to see what we can do as Governments together to help these people.
JOURNALIST: And you have come to Corangamite, no doubt Barnaby Joyce will be in Murray next week, do you think it is really appropriate to be visiting these people at this time when they have such a crisis on their hands when essentially you are trying to get re-elected, or elected sorry?
FITZGIBBON: Well, my sense this morning is that these people are very pleased we visited. I learned a lot from them this morning, as did Jaala. One thing I did learn, is that their major concern is the banks and the capacity of the banks to move on them in the not too distant future. Thats why one of my priorities now will be to go back and talk to the banks and appeal to them at this time when their reputation is under all sorts of pressure. To take a sympathetic look at what is happening here and right throughout Victoria and sadly potentially right throughout the country and to do their bit to help these people through a very difficult situation.
JOURNALIST: Is there a place for regulation from the Government?
FITZGIBBON: Well, what sort of regulation are you talking about?
JOURNALIST: Farmers have been talking about needing something to stop this happening again so that that retrospective price cut could never happen - obviously processes are involved in that. Does the Government ever step in and what are the dangers around that?
FITZGIBBON: I didnt speak to anyone here this morning that thought that government intervention in the market was the answer for them. This is all about realistic expectations about the market - its about having a productivity agenda. We have some great custodians of the land here in terms of our dairy farmers, experienced people who know how to work their industry and the land but productivity should always be on the agenda. Sadly, Barnaby Joyce has no productivity agenda. He released a White Paper last year which barely mentioned productivity, nor did it mention sustainability. These dairy farmers are also affected by drought and yet Barnaby Joyce drought or sustainability in farming and agriculture is a phrase that dare not leave Barnaby Joyces lips.
JOURNALIST: Farmers supported bringing back minimum prices [inaudible] around wholesale price market and say go back to regulation. Is that the answer?
FITZGIBBON: I havent spoken to any farmers this morning that were talking about government control over prices, there might be some out there of this view. Dairy farming is a broad church 6,000 or more dairy farmers nationwide and theyll have various views. But I dont think - particularly in the circumstances we face now - that talk of government intervention on prices is helpful and again like Barnaby Joyces $11 per litre price for milk unnecessarily raises expectations.
JOURNALIST: But you could argue the way the processors [inaudible] put them down on price is an [inaudible] to the way the big supermarkets have been dealing with their suppliers and have been fined accordingly?
FITZGIBBON: Market power certainly is an issue and someone put it to me that dairy farmers went into $5.60 a litre with eyes wide open. I think that is a ridiculous comment. There is no comparison in the negotiating power of Murray Goulburn compared to its suppliers. But in any case $5.60 seemed a reasonable proposition to dairy farmers and Ive had that confirmed here this morning when Barnaby Joyce is running around talking about a litre of milk securing $11. You can understand in those circumstances why dairy farmers assumed that a $5.60 proposition was a reasonable one.
JOURNALIST: When you get the two biggest dairy processors dropping their price by the same amount is there an issue of collusion in there?
FITZGIBBON: Well, when you get the two biggest processors, marketers dropping their price you know you have a problem that is going to reach well beyond South and South-West Victoria.
JOURNALIST: Minister Pulford Im just wondering with the task force how big a job does it [inaudible]
PULFORD: At our first meeting the discussion focused on defining the task and that was a few days ago now. So even in earlier days than we find ourselves in now. The processors are certainly accepting that there was a job for them to do to work together they usually prefer to compete rather than to work together - but on this they accepted that they need to work together and they have a responsibility to their suppliers that theres a lot of programs and [inaudible] already extension services and advice to farmers that need to be extended so that was certainly a focus of the discussion. But in the first instance what was agreed was some immediate work to be done on properly understanding the impacts of this. In the Northern part of the State, also in the South-West and Gippsland. But in the Northern part of the State in particular, there are additional pressures around water. We have some areas where farmers have greater debt in their b usinesses than others which will make them a little more exposed to this. So trying to properly understand that were talking about 4,300 dairy farmers across Victoria.
Victorian dairy is 75-80 per cent of the National story. Its the heart and soul of Victoria and agriculture, so its incredibly important to us and its incredibly important for the Victorian economy. So in the first instance our efforts have been to bring people together and to properly understand whats happening and whats unfolding. I think the thing that our dairy farmers are looking for next is a signal from those processors about their opening price for 2016-17. At the moment, they know theyve dealt a very harsh blow and one that gets back dated to the beginning of this financial year. What theyre now turning their minds to is whats happening on the 1st of July. So I urge processors to get their skates on and provide some certainty in a very uncertain environment.
JOURNALIST: But farmers say whats the point of an opening price if you can suddenly drop it retrospectively anyway, so theyre now saying who cares about the opening prices because there is no faith in it anyway?
PULFORD: I can understand given the events of the last couple of weeks why their confidence in that system has been severely eroded, but people need to work with accurate information and contemporary information. The farmers that Ive been speaking to are pretty keen for that next signal from the processes.
JOURNALIST: Mr Fitzgibbon, there is a lot of talk from a farmers perspective, you know, you are here in a marginal seat, you have said that you are here to listen, you said that you have spoken to all the industry groups now. What does this package look like, what and how will you actually respond?
FITZGIBBON: Im going to make this the last question because Im getting lockjaw in the cold. I think all Australians expect both government and opposition to be responsible and it would be irresponsible for me to come here today to listen to farmers and then give you an immediate response. That wont be the expectations of dairy farmers. Jaala and I need to work together now and Im sure she will be appealing to the current Government for cooperation as well. We will go back and look at the situation. I have gained a number of things from the conversations this morning and will come back at an appropriate time when we have got a properly considered and costed approach. Jaala mentioned her taskforce, I agree we need to allow the taskforce to complete its work, I think that is only a week away now, Minister? So thats now not far away so we will come back and we will have something more to say when we know what the approp riate response is and you will learn that in good time.
JOURNALIST: Can I just ask you, you started the campaign now, you are on the campaign trail, you will spend a lot of time in regional areas. Do you have a lot of hope that you will win some of these regional seats back and also just on that note it has been nearly five years since you or a Labor Government stopped exports to Indonesia. Do you think regional Australia has forgiven you?
FITZGIBBON: I will spend all of my time over the course of the eight-week period in rural and regional Australia. In fact, Im already doing so and everywhere I go I find regional communities are deflated by Malcolm Turnbull. They feel let down in areas like health, in education, in jobs, in the National Broadband Network - which of course is a big one. We will continue to campaign, we will continue to roll out our positive policies for rural and regional Australia. On the issue of the suspension, the 2011 suspension, it was a difficult time and all of us wish we hadnt been through that crisis. But can I say that something very good came out of that period and that is the best animal welfare system in the world. That has put the live exports sector on a sustainable footing, has significantly improved our reputation around the globe and has allowed us to open up markets not previously dreamed of. So a difficult time but Im proud of the system we put in place and Im particularly proud of the boost that has provided to the live export trade. Thanks very much everyone.