Lessons of backpacker tax fiasco

Lessons of backpacker tax fiasco

NFF CEO Tony Mahar.

NFF CEO Tony Mahar.


Bipartisanship promises lost at sea by both major political parties on backpacker tax issue says NFF CEO Tony Mahar.


THERE was a collective sigh of relief across the farm sector on Monday when the Treasurer Scott Morrison announced that the Government would compromise on a 15 per cent backpacker tax rate.

A sigh that reflects 18 months of painful uncertainty and the 11th hour brinkmanship after months of political games.

The outcome is a win for common sense but how did we get here and what are the lessons for the future?

Let’s remember where we started.

The surprise attack by the government in its 2015/16 budget of a 32.5pc backpacker tax.

No consultation, no negotiation and not even any economic modelling.

It was a back of the envelope exercise that has to go down in history as one of the worst examples of government policy making in the agriculture sector’s history.

The NFF was ardently opposed to the 32.5pc rate and campaigned hard against it.

The government eventually back flipped to 19pc but only after the NFF and farm sector’s campaign to find a fairer rate of tax that attracted backpackers to work, is internationally competitive and is comparable with rates paid to Australian workers.

That included the NFF placing firmly on the table in March this year a solution of a 15pc to 19pc rate of tax.

In recent weeks as the end of the sitting weeks approached, the political games commenced drawn on by the tight numbers in the parliament.

All sides went to their corners like the last round of a boxing match, swinging hard but without really landing the punches that mattered to farmers and growers that wanted the match over long ago. 

In order to force an outcome, the NFF shifted ground last Friday in calling on Labor and the crossbenchers to negotiate with the government to find a compromise.

This shift in message was lost in the political theatre of Senator Lambie’s very aggressive welcome to Fiona Simson in the Senate courtyard, but that shift was significant.

This brings us to the 15pc compromise – a decision too long in the making and causing significant collateral damage across the sector.

Backpackers at this crucial point in the picking and harvesting season are tough to get.

Many have already made plans to return home for Christmas leaving growers and farmers short of staff and fruit rotting on trees.

With a deal down and at the time of writing, expected to pass in the parliament early this week, it is worthwhile looking at the important lessons for the farm sector and for our politicians.

For all the rhetoric of bipartisanship by the Coalition and Labor, it was lost at sea on this issue.

Why backpackers and the farmers that employ them had to become a political football will forever remain a disappointment.

It may take many seasons to rebuild the backpacker numbers and for this all federal MPs and Senators must take responsibility.

Bipartisanship can’t mean from either side simply a process of deciding a position, announcing it and defending it to the hilt without compromise.

That is old style thinking and ineffective in this tight parliament.

The government must change its engagement model and be prepared to consult early and often with the Opposition and crossbenchers to build support for its initiatives for the farm sector.

Similarly Labor can’t be late at the table on agricultural issues and must seek consensus just as much as the government.

This new order of politics better reflects what the farm sector wants - good public policy making in the interests of farmers, their families and their communities.

For the farm sector, the biggest lesson remains disunity is death.

Once again, we have seen the sector pockmarked with differing views on how to resolve the backpacker tax and more dangerously, an unfortunate willingness to attack other organisations within the sector including the NFF.

Let’s make it clear, the NFF may not represent all farmers but it is by far and away the organisation that represents most Australian farmers.

It consulted widely through its 30 members and more widely through a very public campaign.

Those who sought to undermine or attack the NFF over this issue, only undermine the farm sector’s voice in Canberra.

You don’t get anywhere in Canberra by having half a dozen groups purporting to represent the same people by lobbying different positions.

Senator Xenophon aptly captured the issues when he said this week in the Senate to not let perfection be an enemy of the good.

Arguing for a position that is not realistic does not cut through in the pragmatism of Canberra but this was unfortunately lost on some.

The farm sector must have strength in numbers and rally behind a position.

As the NFF moves forward with its Australian Farmers representative model for a truly national farmer body, the backpacker tax fiasco is a reminder that the farm sector must be united to work and collaborate together.


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