THE previous government developed the National Food Plan, to “set a long term direction for our food system and help prioritise our actions and focus resources”.
The current government is developing a White Paper to “drive the long-term agricultural policies of the government and ensure Australia’s agriculture sector remains a significant contributor to the economy and local communities".
We do not have a plan for the mining industry, the finance industry or underpinning the proliferating coffee shops. So why spend taxpayers’ money on a plan for agriculture?
Central government planning does not have a good record. The former Soviet Union was fond of five-year plans that prescribed how the country was expected to operate. Giant billboards were erected in major cities exhorting the populace to strive to reach the plan’s goals.
But it was all fiction. Production never matched the plan, the country either ran out of things or they were in the wrong part of the country, and huge amounts of stuff had to be imported.
Most of the National Food Plan was similarly fiction. While some of the goals were rational, the means of achieving them were fanciful. It is now dead and buried and its website archived, but there is a sense of déjà vu about the forthcoming White Paper.
I don’t believe Australia needs a plan for agriculture any more than it needs one for the tattoo industry. But if we are to have one, it could probably be limited to a single paragraph that reads, ‘let’s feed and clothe as much of the world as we can, indefinitely and profitably’. Everything else just follows.
That would not be sufficient for Ag Minister Barnaby Joyce though, because he likes to think he has his hand on the tiller. So I have come up with a few suggestions for him, and the government in general, to turn that aspiration into practical reality.
Because the aim of the White Paper is to “identify pathways and approaches for growing farm profitability and boosting agriculture’s contribution to economic growth, trade, innovation and productivity”, my list starts (and ends) with the removal of government-caused obstacles to profitable agriculture production. Spending other people’s money is not required.
There are hundreds of such obstacles, led by restrictions on private property. Let’s get rid of the prohibitions on land clearing along with all the other rules and regulations preventing farmers from using their properties for productive purposes. In fact, how about an entrenched legal right to “quiet enjoyment” that binds the government? If the owners of privately owned land are not harming anyone else, it should be nobody else’s concern. And if the government diminishes its value, it should pay compensation.
Next on my list is government intervention that drives up the cost of inputs such as chemicals, machinery, freight, fertiliser, seeds and services. There are still plenty of inputs subject to tariffs, which bumps up their prices, and the rules and bureaucracy that govern the supply of inputs add substantially to the final price paid by farmers. Think agricultural chemicals, fertilisers and road transport, for example.
Next, make it easier to employ people to work on farms. The minimum wage prevents hundreds of thousands of Australians from getting a job, quite a few of them on unemployment or disability benefits. Many would welcome the dignity of work and to earn more than they receive in benefits, and there are thousands of farmers who would be glad to employ them, but it’s against the law unless they are paid the minimum wage.
And it doesn’t stop there. Those with a job must be paid penalty rates for working on weekends, public holidays and after hours, yet the right time for sowing or harvesting crops, or shearing sheep, is not limited to business hours. Let’s allow employers and employees to negotiate their own terms of employment and keep the government’s nose out.
Then there is the question of liability. Landowners and employers are commonly held liable when a visitor or employee on a farm is injured, even if primary responsibility lies with the person injured. The cost of insurance to avoid crippling costs contributes to high farm overheads. Let’s reinstate personal responsibility and put an end to incessant victimhood.
The government also reduces the profitability of agriculture is by putting its hand in farmers’ pockets. An example that particularly grates is compulsory levies to fund generic marketing and R&D, with many producers paying tens or hundreds of thousands of dollars a year, and a few over a million.
Some claim the levies address market failure, although economists tell me it is governments that fail, not markets. And while the levies are occasionally used for industry benefit, an awful lot of money is wasted. Ultimately, marketing and innovation are what determine which businesses succeed and which do not. Let’s boost profitability by abolishing levies, or at least give each industry a vote on whether to retain them.
And the final item on my list, although I know there are many others that could be added, relates to capital gains. Farmers invest heavily in their properties in the expectation that at some time in the future they will get it back in the form of higher value. Let’s allow them the freedom to sell their farms to the highest bidders, no matter what nationality they are.
Now that’s a plan.