The Squaretable Initiative

14 May 2014

Senator O’SULLIVAN (Queensland) (19:25): I have been a senator for less than 100 days, yet, as I travel across Queensland and the wider nation, I truly feel a sense of renewed vigour in rural and regional communities because government has committed itself to supporting the challenges and opportunities that lie ahead for those in areas outside the major metropolitan and high-population centres. This government recognises the need to support and enhance the viability and capacity of our communities in rural and regional Australia.

It should be noted that the Prime Minister has repeatedly told the world that Australia is open for business. Some people have mistaken that declaration by the Prime Minister to mean that Australia is up for sale. I believe that that was not the intended message. Whilst all in government have an open mind with respect to foreign ownership, particularly the nuances associated with ownership in the agricultural and processing sector, I am of the opinion that the statement related to a commitment on the part of government to work with trade partners in a modern, globalised economy that has, as its collective objective, fair and equitable trading arrangements that bring mutual prosperity to the participating nations. However, this goal cannot be achieved unless the government demonstrates a commitment to working in partnership with the private sector in these communities to pursue and realise these significant economic development opportunities.

Our nation is confronting a critical juncture as we see mining revenues, which we have so heavily depended on in the early years of this century, commence to decline. This was inevitable. As this mining boom comes to an end, we are again experiencing a shift in focus to the so-called soft commodities in agriculture. More and more, we are hearing economists say that a vibrant, innovative and competitive agricultural sector will be one of the pillars essential to underpinning a diverse, world-class Australian economy into this 21st century.

Rural and regional Australia is poised to reap the benefits of this transition. The rise of agriculture as a major focus of the Australian economy is not a new concept. This is not a new economy. It is an old and indeed important economy that is returning to prominence. Whilst this nation has been trading and exporting commodities since British occupation, the terms and conditions that will frame this future trade opportunity will look very little like anything we have experienced previously.

Modern export markets demand the very best product and produce that we can deliver, where, to the extent possible, goods are free of traces of hormones, pesticides and herbicides and—for some—genetic adjustment. These goods need to be fresh and they need to be delivered in pristine condition. They need to meet the customers’ standards, they need to be priced competitively, and they need to be better than those of our trading competitors. In export parlance, ‘Quality is the new black.’ Where our export trade involves livestock, there have been demands of social licence made on our exporters that have continued to affect the trading commodity all the way through the downstream supply chain until the animals are humanely processed. Long gone are the days when we can do what we like with our exports because we have them and our customers do not. However, I remain troubled by the increasing intervention of environmental groups in this process. In recent years, a number of certification and labelling programmes have been imposed on business in the effort towards perceived sustainability certification systems as defined by multinational corporations. These programs have been promoted by corporately sponsored activist groups as reflective of the community’s environmental and social concerns. These programs have, more often than not, included auditing by third party organisations, where the costs of the process are met by the producer-grower community.

Whether it is forestry, seafood or palm oil, the formula employed by the green movement on industry is the same. Activist groups such as the WWF apply public pressure on both industry and business. These activist groups continue to lead, and sometimes use commercial intimidation, until private enterprise agrees to join the activists’ program. The end result is a scheme that simply adds a further level of regulation and cost to these businesses. Furthermore, and as previously stated, there is evidence that some of these groups are funded, in part, by end users in the food supply chain—who are more motivated by adding a marketing edge to their sales campaign than either environmental protection or the economic viability of the relevant industries.

It must be noted that less than two decades ago retailers knew little about sustainability and certainly not certification programs that audited these efforts. Therefore, the question arises as to what lay behind the rise of these efforts and how business can best address these valid consumer concerns. My answer is simple: the solution must be directed by industry. It must be driven by the improved promotion of industry’s existing efforts in this space. No one wants a sustainable product—environmental as well as economic—more than I do. However, it is my personal view as a businessman that the most important decisions need to be made by those who have their hands in their own pockets, because ultimately they will be the beneficiaries or the victims of the risk and reward strategies that are put in place.

In recent weeks, my colleague Senator Boswell and I have announced the formation of a ‘squaretable’ of farming representative groups in response to vocal constituent opposition to Australia’s participation in the Global Roundtable for Sustainable Beef. The squaretable, which will meet for the first time next week, is a steering committee consisting of beef sector organisations that represent grassroots industry stakeholders. Its underlying ambition is to improve communication between these representative bodies to facilitate a unified stance and action plan to deal with significant challenges confronting the beef sector.

I have repeatedly said, and continue to maintain, that the agriculture sector has a bright future as the Asian middle classes look to our nation for a quality and reliable food supply. Our agricultural output remains the envy of the globe and its demand is ever increasing. Australian farmers meet, and in most instances exceed, any accepted key performance indicators or world’s best practices and so we are well placed to serve these volume market demands as the Asian middle classes expand. Therefore, it is clear that any effort to collate and communicate the industry’s sustainability credentials must lay with the private sector—especially those organisations whose future viability is dependent on this process. If we are to truly capitalise on the increasing food and fibre demands in this ‘Asian century’, then our government must work with private enterprise to reduce the regulatory burdens that jeopardise productivity and viability.

Whilst there is no doubt there is a plenitude of burgeoning opportunities, we must first confront the government’s tough fiscal situation so that we can restore stability and increase the ability of businesses to plan. Last night, the government proved its willingness to make the difficult but necessary decisions so that we can ensure prosperity for all in the future.

This first Abbott government budget calls on everyone and every business to contribute. We are strengthening the workforce, boosting productivity and building a stronger economy with more investment. But there is still much work to be done. To fully realise the significant opportunities that lie ahead of our nation, the coming years will require an almost obsessive focus from all tiers of government on delivering reforms that enable Australia to remain one step ahead of our international competitors.

We must refocus our economy in part on agricultural and primary production and those sectors and communities that support these important deliverers of wealth. We must be prepared to be innovative. We must continually question our methods in the search for the cutting edge. We must strive never to be complacent but to always remain committed to being quality trendsetters, not followers.

The fundamental goal is to improve returns to the farm gate. This will mean greater resilience and long-term profitability for farmers, more jobs, more investment and stronger regional communities. We now have a strong foundation to begin this next stage of economic development. This government is focussed on laying the foundations so that future generations might benefit. In a resource-hungry world, our rural and regional areas hold the keys to Australia’s prosperity. And every one of us should, and indeed must, contribute to the implementation and strengthening of this vision.

Senate adjourned at 19:35