Australia Fund a drought solution?

05 Sep, 2014 02:45 PM
Clive Palmer.
Australia needs a mechanism to properly manage and respond to these issues
Clive Palmer.

CLIVE Palmer’s push for an Australia Fund has been mooted as a potential solution for producers and rural communities struggling with business risks caused by drought and natural disasters.

This week, the Palmer United Party leader and Queensland MP gained approval for a joint parliamentary committee to investigate the creation of an Australia Fund. Earlier this year Mr Palmer introduced a private member’s bill calling for the Committee’s establishment which was co-sponsored by Independent MPs Andrew Wilkie, Cathy McGowan and Bob Katter.

The Fund aims to provide expedient financial support for rural and manufacturing industries when hit by natural disasters like drought, bushfires and floods.

PUP Senate leader Glenn Lazarus co-sponsored the bill with LNP Senator Barry O'Sullivan, which passed the Senate this week. Senator Lazarus said it was a “huge win” for rural and regional Australia, farmers, growers, graziers and those involved in the manufacturing industry.

“Australia is a country devastated by drought and natural disasters,” he said.

"Australia needs a mechanism to properly manage and respond to these issues to ensure we protect and progress the interests of all Australians. An Australia Fund would deliver this type of solution.”

Senator Lazarus said the committee would examine the type of assistance the Fund could potentially deliver including: emergency or ongoing financial relief; loans; grants; guarantees; other forms of assistance, and whether additional flexibility is needed in relation to bankruptcy and insolvency.

The committee’s establishment formed part of the historic agreement reached between the government and Senate crossbenchers - including three PUP Senators - to remove Labor's failed mining tax.

But the move alarmed and angered Greens leader Christine Milne who said, “What we have never been told is whether the backroom deal also includes a sum of money”.

“I think it is important for the parliament to know how much money has been promised behind the scenes for this particular fund,” she said.

Senator Milne also accused the PUP of “hypocrisy in the extreme” by wanting to establish a fund for communities affected by natural disasters when extreme weather events fuelled by climate change are driving the natural disasters.

She said “the Palmer United Party does not want to address the polluters, and wants to now take the money out of the public purse”.

But Minister for Finance Mathias Cormann dismissed the Greens concerns.

“We think it is quite appropriate for parliamentary committees to investigate issues of public concern and issues that are relevant to public policy considerations into the future,” he said.

“But, on any suggestions by the Greens or others that somehow the government has predetermined any outcomes from that inquiry by making pre-emptive allocations of funding, no, we have not.

“What we have said is that we are very happy for the parliament to set up a committee to investigate these matters, which are clearly matters of public concern, and we will await the recommendations of that inquiry before we make further decisions.”

Opposition leader Bill Shorten also took objection and accused the government of breaking an election promise to not do deals with minor parties.

He called on Treasurer Joe Hockey to rule out creating the Fund which he called a "Palmer piggy bank".

But Mr Hockey said the government was prepared to negotiate to get its agenda through with anyone in the Senate.

“The minor parties have different attitudes towards different policies and we have to negotiate our way through to get the best outcome for the Australian people,” he said.

Mr Hockey said the Australian government did not support the proposed fund in principle because they believed industries and business should not become reliant on taxpayer support, “because ultimately industry assistance is revenue from another person”.

He said the Committee would be left to do its job, “but in principle we do not like the idea of such enterprises”.

Federal Agriculture Minister Barnaby Joyce told the ABC the concept needed "proper ventilation".

"We should never be so conceited in Canberra that we start telling the Australia people what they can and cannot think," he said.

“The process of an inquiry is to plumb those thoughts and ascertain what can be done.”

Australian Farm Institute executive director Mick Keogh said he had seen very little detail of the Australia Fund and how it would operate but will monitor the committee inquiry and potential recommendations.

“It’s all too vague at the moment; I don’t know what it means,” he said.

The committee’s report and recommendations are scheduled to be tabled in parliament on or before June 30 next year.

Mr Palmer said the committee would undertake hearings in all capital cities and major rural centres and examine impacts on rural Australia of ongoing drought and world market price fluctuations for primary industry produce.

He said the committee’s terms of reference would also include reviewing existing bankruptcy and insolvency laws with the aim of introducing legislation designed to assist companies to trade through difficult times, rather than be closed down.

In his speech calling for the committee’s establishment in March, Mr Palmer questioned whether the government’s drought assistance package could have been more inclusive and targeted at a wider industry and more communities.

He said the $320 million package announced in March seemed to be targeted at beef and sheep properties.

“I commend the government for providing it but there are more things to consider than cattle and sheep,” he said.

“Most rural towns and businesses rely on their trade, employment and small-scale manufacturing of the rural industries to support them.

“There are many rural properties that are involved in primary production that have not received any real assistance at all.

“I do not think this was by design of the government but the government's advice, or any government advice may have been limited.

“It is time this House investigated if Australia can handle these situations better for the benefit of all Australians and the taxpayer.”

Colin Bettles

Colin Bettles

is the national political writer for Fairfax Agricultural Media
Date: Newest first | Oldest first


Catriona Thoolen
5/09/2014 3:48:03 PM

I think it is an excellent idea. Our farmers compete against subsidised farmers around the world and then still have to face tariffs added to the price of their produce. A bit of a hand in having some govt underwritten loans or grants in times of difficulty would not go astray. Small regional manufacturers get into trouble when our farmers have a bad year and are unable or unwilling to buy/replace/ repair equipment. Bout time time a government had a plan to support our farmers before all the farmland is sold off to oversea owners, who are willing and able to subsidise through the bad years.
5/09/2014 4:08:25 PM

This is a terrific idea. I think we need an insurance scheme which covers the cost of feeding our livestock through times of drought. As it stands now it is way too expensive to do so.
5/09/2014 4:45:21 PM

best thing to come out of Canberra in a long time
6/09/2014 2:50:08 PM

What Australia really needs is some sort of Infastructure banking like China has to develop areas of Australia that will provide benefit for future generations rather than selling off our farms or industry to any willing overseas buyer (even foreign Governments). Team Australia needs to work for Australians first.
Bushie Bill
6/09/2014 3:45:27 PM

Agricultural socialism gone wild, led by a hot air baloon and egged on by low intellect agsocs demanding Australia pays for their chosen lifestyles. Get real bozos. Ain't gonna happen.
Bushfire Blonde
7/09/2014 7:46:10 PM

The main thing Aussie Primary Producers want is a fair go the the Market place. They do not want charity. Get rid of the Duopoly in the food retailing sector and get rid of the duopoly in the beef processing sector
Bushie Bill
7/09/2014 8:50:48 PM

The cargo cult continues; agrarian socialism at its very worst.
farmer Joe
8/09/2014 8:12:42 AM

What is the difference between the Australian Fund idea and tabled legislation for the Australian Reconstruction and Development Bank. These idiots are all running around trying to "be the man" while we die in the bush. Stop all the posturing and peacocking and just do something that actually makes a difference!
King Billy
8/09/2014 11:45:09 AM

A tax averaging plan covering the seasonal cycles ( 7-8 years?) is a better way to support farmers/ graziers long term. And a Rural Bank using farmers own funds means tax free " rainy day" money when needed. Australian agricultural and horticultural production has been shaped by having to compete against farm subsidies in many countries and Government needs to recognise that. No more band aid approach to Agruiculture !
Bushie Bill
8/09/2014 5:16:58 PM

How about all you bozos who fight each other to grab "free money" (it aint free-someone is paying for it) should learn to run your farms as a business and not as lifestyles. Then Australian taxpayers need not be hassled for money every time the creek rises or it doesn't rain for a week or whatever other excuse inventive farmers can dream up.
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