A Govern­ment and bud­get that is de­liv­er­ing for farm­ers

Australian Farmers & Dealers Journal - - BUDGET UPDATE - BARN­ABY JOYCE POST-BUD­GET OPIN­ION PIECE

Here's a lit­tle story about Jack and Diane. Two young farm­ers do­ing as best as they can. And if they sell $1.9 mil­lion of cat­tle and grain a year, or grapes and wine, or wool and lamb and their turnover is un­der $2 mil­lion then they have the ben­e­fit of record com­mod­ity prices and now have an over­whelm­ing rea­son to in­vest in their farms to make it big­ger for them and bet­ter for Aus­tralia. From 1, July 2016, the fences they build are 100 per cent de­ductible in the first year. The wa­ter in­fras­truc­ture and dams they put will also be im­me­di­ately 100 per cent tax de­ductible. The si­los and hay sheds they build can be writ­ten off over three years. As of 7.30pm on Bud­get night, small items of plant and equip­ment such as the post-hole dig­gers, chain­saws, mo­tor­bikes, quad run­ners, cat­tle crushes, pumps, gen­er­a­tors, welders, sec­ond-hand vehicles and other items that cost up to $20,000 and are used on the farm are in­stantly 100 per cent tax de­ductible. With a record turn­around in prices for cat­tle, sheep, wool, grains and in­creas­ing prospects in wine, trop­i­cal fruits and citrus, they are also able to get a 5 per cent dis­count on their tax capped at $1,000 per year. The Agri­cul­tural Com­pet­i­tive­ness White Paper that is yet to come but is bud­geted for will as­sist fur­ther in these two young farm­ers' po­si­tions. The Coali­tion has presided over one of the great­est turn­arounds in soft com­mod­ity prices, so be­cause of our six new live an­i­mal des­ti­na­tions and three new Free Trade Agree­ments, Jack and Diane are en­joy­ing record prices for cat­tle, sheep and a dra­matic turn­around in the East­ern Mar­ket Wool in­di­ca­tor, strong prices in citrus, wine and grape and a vir­tual mosh-pit of in­ter­na­tional buy­ers try­ing to pur­chase their prod­uct. Jack and Diane have vastly bet­ter prospects in Aus­tralia now than they did in the John Mel­len­camp song. At the same time the Farm House­hold Al­lowance will spend close to half a bil­lion dol­lars over the for­ward es­ti­mates in re­gional ar­eas, which is in fact a half bil­lion dol­lar eco­nomic stim­u­lus pack­age for re­gional com­mu­ni­ties which are do­ing it tougher in the drought ar­eas. This money is spent in lo­cal towns and busi­nesses sup­port­ing re­gional com­mu­ni­ties. On top of this is the fur­ther re­cent an­nounce­ment of a $35 mil­lion stim­u­lus pack­age for the com­mu­ni­ties at the epi­cen­tre of the drought, and a fur­ther $25 mil­lion on top of the $8.5 mil­lion al­ready al­lo­cated for pest con­trol for pests such as wild dogs and pigs. This money is spent on such things as fenc­ing ma­te­rial which un­der­pins the busi­nesses of ru­ral sup­pli­ers and hard­ware stores. Farm­ers do­ing it tough also have the ben­e­fit of be­ing able to ac­cess fur­ther con­ces­sional loans above the $270 mil­lion al­ready lent out. And an ex­tra $250 mil­lion has been made avail­able for the next 12 months at 3.84% and 3.21%. This means that banks have to be com­pet­i­tive in the money they lend and farm­ers know that the govern­ment is part­ner­ing with them in re­plant­ing and re­stock­ing af­ter the drought to as­sist the na­tion in the growth of the soft com­mod­ity base. We also com­mit­ted $20 mil­lion for so­cial and men­tal health sup­port in recog­ni­tion that the peo­ple on the land are our most im­por­tant as­set and we must al­ways look af­ter them.

These mea­sures are part of the $333 mil­lion drought pack­age an­nounced by the Prime Min­is­ter on the week­end. Our at­ten­tion to drought can also be seen in the Farm House­hold Al­lowance fort­nightly sup­port pay­ment that is cur­rently be­ing re­ceived by over 4,800 farm­ers or their part­ners; and the 531 farm busi­nesses that are ac­cess­ing con­ces­sional loans. For farm­ers are in North­ern Aus­tralia, they will ben­e­fit from a $5 bil­lion in­fras­truc­ture pro­gram which in its ini­tial an­nounce­ment in­cludes $100 mil­lion on beef roads so farm­ers can get their produce to mar­ket in more ef­fi­cient ways. We have an in­crease in ex­ports of cher­ries and citrus. We have com­pleted the Wheat and Bar­ley Pro­to­col for China. We have started, and are well on the way, in de­liv­er­ing a Coun­try of Ori­gin La­belling scheme that is sim­ple, di­a­gram­matic, re­flects pro­por­tion­al­ity as to the amount pro­duced in our coun­try, and is com­pul­sory. We have changed the For­eign In­vest­ment Re­view Board guide­lines to give proper over­sight to our most pre­cious as­sets - the land we stand on and the food it pro­duces - not only for our na­tion, but for so many oth­ers. We have had prob­lems with grapes into Viet­nam in the past, but we now have ma­jor new mar­kets for our wine and ta­ble grapes into Ja­pan and Korea and a re-open­ing of the China mar­ket – sig­nif­i­cant mar­kets that are mak­ing a dif­fer­ence. We are see­ing signs of a turn­around in the wine in­dus­try with new con­tracts. We've opened up new mar­kets for fruits, in­clud­ing ly­chees and man­goes. In live­stock ge­net­ics we are also real­is­ing new op­por­tu­ni­ties, with bet­ter ac­cess for our bovine ge­net­ics into the US. We are work­ing with in­dus­try to de­velop ex­port strate­gies, so that our ef­forts achieve the best pos­si­ble out­comes for farm­ers. We have also re­formed the Re­search and De­vel­op­ment Cor­po­ra­tions for our wine and wine grape pro­duc­ers, as well as for our hor­ti­cul­ture in­dus­tries. We have de­liv­ered three free trade agree­ments to give ac­cess to so many sec­tions of agriculture — to China, Korea and Ja­pan. And we have opened six new live an­i­mal mar­kets: Egypt, Bahrain, Iran, Thai­land, Cam­bo­dia and Le­banon. We've got kan­ga­roo meat mov­ing into Peru – tak­ing some pres­sure off the Western dis­tricts where there are ex­ces­sive num­bers adding to the drought. As al­ready stated we've put ma­jor money on the ta­ble to con­trol pests, in­clud­ing wild dogs. We've de­liv­ered the first ma­jor new pro­gramme in decades, to con­trol this scourge that leaves sheep and cat­tle maimed or dead, de­stroy­ing farm pro­duc­tiv­ity. We have as­sisted in the de­liv­ery of on farm wa­ter in­fras­truc­ture with $23 mil­lion for on-farm bores, pip­ing and troughs, and in­vested a fur­ther $15.9 mil­lion in the cap­ping and pip­ing of bores in the Great Arte­sian Basin. We have started our dams pro­gramme, with $60 mil­lion for wa­ter in­fras­truc­ture in Tas­ma­nia and fund­ing for the Chaf­fey Dam in Tam­worth. And we have funded the con­tin­ued de­liv­ery of in­fras­truc­ture in the Mur­ray Dar­ling Basin. We have fo­cussed on small ex­porters, and we have put into ac­tion our Biose­cu­rity Rapid Re­sponse team, for in­cur­sions such as the Cu­cum­ber Green Mot­tle Mo­saic Virus and Panama Dis­ease. As I write, we are on the cusp of pass­ing the Biose­cu­rity Bill 2014 – the sin­gle largest leg­isla­tive re­form to Aus­tralia's biose­cu­rity sys­tem in more than 100 years. This year's bud­get de­liv­ers prac­ti­cal sup­port to pri­mary pro­duc­ers and en­cour­ages money to be spent on-farm to in­crease pro­duc­tion, and now means that ev­ery farmer has even more in­cen­tive to in­vest in drought re­silience over the long term. The ac­cel­er­ated de­pre­ci­a­tion mea­sures for pri­mary pro­duc­ers (for fenc­ing, wa­ter in­fras­truc­ture and fod­der stor­age), the ad­di­tional $20,000 in­stant write-off for small busi­ness, the cut in the cor­po­rate tax rate as well as the ad­di­tional five per cent tax dis­count on prof­its in­clud­ing non-cor­po­rate en­ti­ties, capped at $1,000, will make an im­me­di­ate and pro­found dif­fer­ence to farm­ing op­er­a­tions right across the na­tion. We have in the bud­get the money for the fur­ther de­liv­ery of the Agri­cul­tural Com­pet­i­tive­ness White Paper which will be an­nounced once we have al­lowed the Aus­tralian farm­ing com­mu­nity to ab­sorb the sig­nif­i­cant bud­get mea­sures an­nounced this week. We have al­ready an­nounced the first round for R&D For Profit grants to deal with pests such as parthe­nium weed and black­ber­ries, but it also funds such pro­grams as dairy ex­ten­sion re­search and in­vests in Aus­tralia's white fish aqua­cul­ture in­dus­tries. The projects funded in the first round will di­rectly im­prove the prof­itabil­ity or pro­duc­tiv­ity of Aus­tralian farms. Why is that? Be­cause that was the key, non­nego­tiable cri­te­ria that I per­son­ally in­sisted upon. We re­main com­mit­ted and are pro­gress­ing well to­wards cre­at­ing cen­tres of ex­cel­lence for agriculture, so that re­gional towns that live in and by the agriculture econ­omy have the in­vest­ment in their ex­per­tise and cul­ture to pro­vide ca­reer paths for young grad­u­ates to have a long term fu­ture in agri­cul­tural re­search and pol­icy. In some of the com­men­tary it is said that the ben­e­fits for small busi­ness are not there be­cause the prof­its are not there. I dis­agree with this be­cause the prof­its for agriculture are there and our job is to ac­cen­tu­ate the ben­e­fits to en­sure the fam­ily farm is the cor­ner­stone of Aus­tralian farm­ing. And com­ing from a small fam­ily farm­ing op­er­a­tion, my sym­pa­thy is firmly for the fam­ily farm­ing busi­ness. This is what the govern­ment has done thus far. Peo­ple know in agri­cul­tural Aus­tralia that this govern­ment has made a real dif­fer­ence to their lives. And peo­ple in agri­cul­tural Aus­tralia can be af­firmed in their view that this ded­i­ca­tion will con­tinue.

Barn­aby Joyce

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.