Senator O’SULLIVAN (Queensland) (19:20): Whilst I do not want to take too much of my time in making reference to the contributions by our colleagues across the chamber, I have noticed a trend since I have returned, and that is: every time they speak, it is negativity followed by negativity followed by negativity, with absolutely zero reference to an alternative plan. The reason they cannot put an alternative plan is that, if they did so, it would be held up against the reference point of their performance before the change of government and they would be exposed for being the inadequate economic managers they are. But that was not the reason I secured the opportunity to speak tonight.
I want to talk on a subject that is close to my heart—and, indeed, I know is close to Senator Sterle’s heart—and that is the economic wellbeing and security of large parts of our country. It is close to your heart too, Senator Smith, and to the heart of any senator, indeed, who represents a large state, as you do with Western Australia and I do with Queensland. We want to see that we have got viable communities and viable economic programs assisting all of those sectors that work.
A fact of life, a reference point that we need to start from, is that we are a trade-exposed nation. Well over 60 per cent of all the soft commodities that we produce are traded, and therefore our fortunes are intrinsically linked to the performance of our nation in developing trade opportunities and then maintaining them.
Australian farmers and producers are amongst the best in the world for innovation, for the use of technology and for labour practices. This, of course, is borne out of the massive amount of foreign investment that occurs in our nation. Other countries and other interests want to invest in our country because of the fact that we have a very solid and stable sovereign risk environment. We have a very settled nation without any border conflicts and so we are very attractive destination. Nonetheless, at the end of the day, we are a trade exposed nation. I say—and I want to continue to talk about this over the coming months—as a government and as a parliament as a whole, we need to now start to look thoroughly at what we can do to support those who produce the trade.
Obviously, one of the first things we need to do is expand our markets. This government, to date, has a terrific track record with the free-trade agreements with Korea, Japan and China, and hopefully, eventually, when the US makes a decision, the adoption of the TPP. There are winners and losers in all of this but, by and large, when I say there are losers, there are people whose fortunes in life are sectors—sugar is one—whose fortunes did not really increase. The FTAs have not diminished the existing opportunities for many of the sectors, but there are some who have not grown under it. There are so many, as I mentioned in a speech earlier today, that we have seen an increase about 27 per cent in the value of our exports in this preceding year, where the figures are kept.
The gross value of farm production is forecast to increase by eight per cent in 2015-16 to around $57 billion. Now eight per cent, of course, in any economy is a leap. That is higher than what the Chinese economy is growing at —it is about 6½ per cent. Our farm economy is growing very strongly in the face of some very severe difficulties such as drought. We have to do some things in relation to competition policy. My colleague Senator Sterle very competently, I must say, chaired a references committee into some competition issues within the sugar industry in my home state. At the end of the day, he got it right when he signed off on recommendations in relation to what we might do to solve some market problems.
We have to expand the markets of the soft commodities because we are transitioning from a resources market. This same area of our nation—away from the metro centres, away from the high populated eastern seaboard, and away from the south-western seaboard of Western Australia—is feeling the impact of the economy coming off from the resources sector. Many of our areas, large tracts of land in both our states and indeed to various degrees in the other states, are starting to feel the impact of this transition from the resources sector. The only solution is the increase in the agriculture sector, so it is an old economy that has come good. It still faces the challenges I talked about such as droughts. The Panama race 4 is a great example of how we can go to bed one night with an entire industry—the North Queensland banana industry—and wake up with what is possibly a serious crisis in that sector.
Farmers are very resilient. We know that primary producers are very resilient. They have dealt with droughts and they have dealt with these biosecurity challenges before and they will continue to do so. But they deserve our government, my government, with the support of others in this place, to assist them to be able to take advantage of these increases that we are starting to see in the farm sector. We are travelling at about 70 per cent higher than the average $50 billion over the five years 2014 in nominal terms according to the ABARES agriculture commodities report. So we are really on the lift. What we have to look at are the things that are keeping some of these sectors and individual enterprises within the sectors back. It is very important that we never abandon the concept that much of these sectors need to be populated by farm family enterprises, primary production enterprises and generational businesses in many cases. I am not against corporate farming. I think that it has a place. I am not against foreign investment as long as, of course, foreigners do not come in and vertically integrate their operations and take their commodities offshore across our road networks and out through our port networks without making a significant and just contribution to the economy of the nation through the tax receipts.
But there are so many things that we have to do. We have to visit upon the issue of farm finance and we have to get much more flexible farm finance products in place. I have often said that the only thing a poultry farmer living next to a sunflower farmer living next door to a feedlot have in common is gravel from the grid to the house, and perhaps a big hat. But when they go in for farm finance arrangements, someone reaches around and pulls down a gumboot—not a thong, not a pair of slippers, but a gumboot—and simply asks them what size gumboot they want. They try to fit all these things into the one finance product. That has to change.
We have to support some of our larger regional councils and we must certainly continue to keep an eye on those services that we, as the government, have an obligation to provide: communication, rural health, education. We also have to support some of our more remote communities. Our Aboriginal communities continue to need the assistance to be viable to continue to grow their contribution to the country’s economy in these remote areas. The time that I am allowed does not give me the opportunity to put a lot of detail under each of the subjects, but in the coming weeks and months I intend to unpack these issues through this place. My behaviour outside this place will be to start, with the cooperation of others, to try and push to get some solutions, particularly in the farm finance sector. We have all had constituent farmers and primary producers come to us. If you look at their problems, many times it is as a result of the restricted nature of the arrangements that they have with the banks. Now I am on meeting No. 6 with the major banks in this country. They have entertained me—and I must pay them credit for that—as we have talked about the prudential regulations that they say are inhibiting their ability to provide a more flexible finance product to our primary producers. I hope to come in here and talk about that in the not too distant future when we have a settled position. In effect, I am simply using this opportunity tonight to put on notice that I intend to now carefully pursue resolution to many of these issues over this calendar year and I look forward to the support of this Senate in that journey.