NEW Coalition agricultural backbench committee Chair Tony Pasin says this year’s policy agenda will be spearheaded by a fierce desire to “tear down” non-tariff trade barriers that limit farm export opportunities driven by free trade deals.
The determined rural South Australian Liberal MP said his Committee would focus on finding ways to take greater advantage of Free Trade Agreements (FTA’s) with China, Japan and Korea that have slashed hefty import tariffs on major farm commodities like beef and dairy.
Mr Pasin said securing new deals - especially with the UK - also remained a high priority in 2017.
He said striking a new trade arrangement with the UK, in the post-Brexit scenario, presented “massive opportunity” for Australian dairy exports given the comparative difference, in lower production costs.
“The story of agriculture politically is really tied to the story of agriculture economically,” he said.
“I think agriculture and agribusiness is on a really bullish march through the Australian economy.
“It’s the bedrock but given we’ve got particularly strong commodity prices across the pre-eminent industry sectors, it’s fairly safe to say that, as a share of the Australian economy, agriculture is growing so therefore its influence in federal parliament is growing and I say happily.
“The challenge for agriculture from a policy point of view is to ensure that the recent gains we’ve achieved, like the three FTA’s, resonate at the farm-gate and across the kitchen table.
“And in order to do that I think the number one priority for 2017 is to tear down the non-tariff trade barriers, so farmers and agribusiness can access and realise the benefits of our FTA agreements with Japan China and Korea.”
The Australian Bureau of Agricultural and Resource Economics and Sciences has forecast the nation’s farm production to increase by 6.1 per cent in 2016-17, surpassing $60 billion.
Mr Pasin said to improve that bottom line number and the nation’s fiscal outlook moving forward, cutting non-tariff trade barriers needed to become a stronger political focus throughout the year, by harnessing the broad-ranging powers of Prime Minister Malcolm Turnbull and a serious collective of political and bureaucratic influences.
“This is not a matter just for the Agriculture Minister Barnaby Joyce and it’s not a matter solely for the Trade Minister; ultimately this is a push that must be led by the Prime Minister bringing together a caucus if you like of interested ministers to ensure that we do tick off on this issue,” he said.
“Diplomacy plays a very important role in trade because it’s one thing to have discussions at an officer level but it’s quite another thing for leaders of nations, and indeed senior ministers, to come together and tear down some of these barriers.
“If there’s nothing else that we do for agriculture over the course of the next 12-months - and there will be - putting our energies and efforts into that endeavour is vitally important.
“It needs to be backed by both diplomatic will and resources.”
Mr Pasin said the influential agricultural backbench committee would also prioritise plans this year for make serious policy improvements to enhance farm labour supply in an effort to achieve sustainability.
He said it would also focus on arresting a “significant drop-off” in tertiary educated agricultural graduates, that’s putting a “strain’ on sector productivity.
His committee also has plans to improve price transparency in agricultural markets; not just for commodity pricing but also for farm inputs like fertiliser.
Another major policy push for 2017 will be looking at ways to incentivise investment in value-adding opportunities in agricultural commodity processing in Australia.
Mr Pasin pointed to tax incentives that boost potential green field projects in commodity processing like meat or dairy products.
Mr Pasin said his committee was also looking to extend the success of tax depreciation measures introduced by the Coalition government in the 2015 federal budget, ahead of releasing its $4 billion Agricultural White Paper, which were praised by farmers nation-wide
That budget saw $70 million allocated for accelerated depreciation claims for fencing, water facilities and fodder storage that were for only two years.
However, Mr Pasin said there was now a “push on” to try and extend those measures beyond the two year limit and also find new ways of delivering similar tax measures that provide economic stimulus and the “same advantages”.
He said improving rural telecommunications and digital connectivity would also remain a big focus given farmers relied heavily on their mobile phones not only for safety but also accessing technological innovations that improve farm profitability and productivity.
Mr Pasin said he didn’t know where the government was at with its plans to introduce a milk pricing index into the Australian market similar to one used in NZ – which was fuelled by a $2 million commitment in the dairy industry crisis support package last year.
But he said he would like to see that policy measure extended as a “replication, rather than reinvention”, to improve transparency for other commodities and farm inputs.
“Price indexation is a very powerful tool - it provides transparency and high quality information to farmers about the value of their commodities,” he said.
“But dealing with just commodities is just one half of this bargain - we should also look to creating indices for inputs because farmers would benefit from having more transparency around the cost of their inputs, relative to other jurisdictions.
“It would allow us to ask some really tough questions of those that manufacture and distribute inputs in Australia about why we may be paying more for example, relative to NZ, for super phosphate.”
Mr Pasin said moves to incentivise investment in local manufacturing facilities would also put more dollars into farmers’ pockets and boost economic opportunity and employment for regional communities.
He said improving competition at saleyards or in general commodity markets was a core policy priority that also involved achieving corporate tax incentives.
“It’s about ensuring there’s greater competition for the commodities that we grow and secondly it’s about capturing more of the value chain in Australia rather than sending raw commodities overseas only to see them processed and that value lost,” he said.
“Incentivising that investment this year will involve questions about reforming our corporate tax plans.
“Given some of that has been bogged down in the Senate, there may be an opportunity for us to encourage the executive of our party and indeed the crossbenchers in the Senate, that we should look to provide an incentive by way of a concessional tax rate for individuals or entities willing to come to Australia and invest in processing; especially in the agricultural sector because it underpins everything we do out in farmer land.”