SPEECH – Release of Red Meat Processing Senate Inquiry Report

12 September 2017

I want to acknowledge my colleagues Senator Williams and Senator McKenzie, who jointly were involved in the development of the reference. Senator McKenzie drove this process. Senator Williams and I joined the reference almost as an afterthought, I suspect. This reference was, I think, stimulated by events that occurred in the Barnawartha saleyards in Victoria. Knowing that Senator McKenzie is going to speak, I probably will refrain from spending too much time on that aspect of the report and its recommendations. I want to acknowledge the support of Labor, through the chairmanship of Senator Glenn Sterle. This was a difficult inquiry and a very long one—in fact, it spanned two parliaments. It is fair to say, and I am sure Senator McKenzie will visit on this, too, that we didn’t always receive the level of cooperation and assistance from the industry stakeholders that one may have expected. I can place on Hansard that Senator Sterle did an exceptional job in chairing the committee as we navigated through some of those challenges.

The early recommendations are to consider an inquiry into pre-sale and post-sale weighing in saleyards, to try to bring some consistency, particularly on the eastern seaboard, with respect to practices in saleyards. Again, I will yield that aspect of the report to Senator McKenzie, because I am sure she is going to touch on that, including the recommendations around what we have named ‘the standards of practice in saleyards’. Again, I will yield to Senator McKenzie on that.

One of the recommendations is in relation to the operations and capability of AUS-MEAT, particularly in their role in oversighting objective carcass management in beef processing plants—a significant role, one that has been challenged by, I think, almost a majority of producers at one time or another. This is where the rubber meets the road—when it is determined what they will be paid for the carcasses of livestock they have sold to the works on what is called the grid. There are positives and negatives about the inspection of carcasses and I think it is fair to say that, in this particular case, over a long period of time there has been a collapse of trust and confidence between producers and processors that this process is as objective as they might like. It was often challenged. There were, and remain, reasonably inadequate options for producers to be able to themselves objectively assess and perhaps even challenge processors on some of the descriptions of their carcasses that resulted in payments that they thought were less than what they had wanted.

The advent of technology coming into the meat processing sector, particularly the technology known as DEXA, a dual X-ray system, will allow processors to more accurately—now in the 90 per cent—assess what the meat yield is of a carcass. It will separate meat, bone and other, and this is a positive step in the right direction, even though there has been, I suppose, caution around how this technology is to be introduced. Nonetheless, anything that increases the prospect of objective carcass management in our processing plants in this $11-plus billion industry is a step in the right direction.

We have made recommendations that the operations and capability of AUS-MEAT be looked at by the minister, through the agriculture department, to see that they have adequate powers and that they are adequately resourced and that we ourselves can have oversight over their operations to see that they are doing the job to the best of their ability.

There are two recommendations that I really want to focus on—and I’ll leave the main interest to me until last. The final recommendation to government and to the minister was that they establish a joint government and industry task force to effectively review all aspects of the meat processing and the meat supply chain and production sector. I think this is very timely. The current structures that they operate in are complicated—relationships are complicated. There is disparity in power bases within the whole sector. Of course, they’re working under operations that were put in place about 19 years ago in 1998 by the then Deputy Prime Minister and minister for agriculture, the Hon. John Anderson. It is almost overdue for that entire sector to be reviewed by this joint government and industry task force. It will be a skills-based task force if the recommendations are accepted. We anticipate it will take them some considerable period of time to do their work, as a comprehensive review in such a big industry and sector would be the case.

Let me use the final time I have to speak about what I think is the key recommendation—or, certainly, which is up there with the top recommendations made in the report. It is for government to do virtually whatever it takes to support the establishment of a new peak industry body for cattle producers. Various numbers have been given to us over time of between 30,000 and 60,000 different producers in this country in the beef sector, ranging from small operators who might only have half a dozen livestock through to big family corporations and, in fact, public companies who oversight an industry that has, or ought to have, about 29 million head of stock at any time. We believe those numbers are down quite considerably due to the advent of droughts all over the country. But what is, I think, agreed to by everyone in the industry is that we need to beef up—if I can use that term—the peak industry body that—

 Senator Siewert: No bad puns!

I thought it was a good pun, and it actually came to me spontaneously, Senator, so I’m very proud of it. We need to beef up the peak industry body that represents these producers. The advent of new technologies and legislation passed here—I think we all were involved in supporting the legislation—allow the peak body to find out who those levy payers are that, collectively, pay about $50 million plus a year into the Meat & Livestock Australia for the support to the industry in research and development. This is about getting a peak industry body. I said at one of the inquiries: ‘We’ll know when we’ve arrived when members of the Meat & Livestock Australia, and senators and other politicians in this place, break into a sweat when they hear that this peak body has arrived in the building to come and see them.’

I want it to be a powerful body. I want it to get its way on behalf of producers around the country. It needs to be a very transparent body. It needs to have its strength and its power embedded in a grass-roots movement within the industry. It needs to have a skills-based board that I personally believe needs to be renumerated. I don’t care how much they have to pay the members of the board and the chairperson to administer this very important industry in agriculture and, indeed, to our whole national economy. It needs to make sure that its structure allows it to represent and reflect the ideals and the ambitions of producers all around the nation.

I want to commend the report and, in the last moments, I want to pay great tribute to the secretariat under Dr Jane Thomson. This was a difficult report to structure. There was a lot of work and effort, and there were a lot of amendments and restructuring of the report as we got towards this tabling date. Their work, as is always the case, was first class.