Bringing democracy back to ag levies

Because they are compulsory, levies are a kind of taxation

IN July I moved a motion in the Senate to disallow regulations that would increase compulsory levies on onions, mangoes and mushrooms. My aim is to bring about long overdue reform of all agricultural levies.

Because they are compulsory, levies are a kind of taxation. Hundreds of millions of dollars are collected from primary producers with many careers relying on them. It is important for levy payers to receive value for money.

Despite assertions to the contrary, I have never sought the abolition of agricultural levies. I am sceptical about how well some are used, but my view is that if primary producers vote to impose taxes on themselves, that is their right. The problem is, most levy payers rarely get to vote.

The two reforms for which I seek the Agriculture Minister’s agreement are, firstly, for levy payers to be given a regular vote as to the level of levies they agree to pay, including the option of paying none, and secondly, in industry sectors where there are wide disparities in the size of producers, that there is proportional voting in line with the size of their compulsory levy contribution.

This need not be expensive. A voluntary postal vote supervised by an independent organisation like the AEC, based on a register of growers, is all it would take.

Establishing the register, if none exists already, can itself be based on voluntary enrolment.

Having spent more than thirty years in agriculture, I have lost count of the number of times producers have complained to me about the obligation to pay levies and their inability to discover or influence how they are used.

As the system now operates, the only producers who have a regular vote on whether to continue paying levies are wool growers and dairy farmers. The WoolPoll, conducted every three years, and the dairy industry poll every five years, both give producers multiple levy choices starting at zero.

Although WoolPoll makes no allowance for production size, it is regular and democratic, unlike the dozens of other levies currently in operation. Some have not been voted on for over a decade, denying producers any say in whether they should be adjusted or continued.

Since I began my efforts to bring some democracy to the levy collection system, it has become apparent that there are industry groups very resistant to the idea of allowing their members a regular democratic voice. That begs the question of why this is so.

If industry organisations are confident their marketing campaigns using producer funds will produce good outcomes for their members, they have nothing to fear from seeking their support. The same goes for R&D expenditure; all they need to do is convince levy payers.

Indeed, such a system would focus the minds of those whose livelihood relies on the continuation of levies to produce tangible results. A focus on performance, or value of money, threatens nobody.

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FarmOnline
David Leyonhjelm

David Leyonhjelm

has worked in agribusiness for 30 years and is a Senator for NSW representing the Liberal Democrats.
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READER COMMENTS

Mranda
24/08/2014 11:41:59 AM

I agree a regular vote by Levy payers on the amount of levy they wish to pay and on the way it is spent would make the process more transparent. However producers would need to have a lot of information at hand and a very good understanding of the cost of the various activities funded by levies to really answer that question thoughtfully.
Mick
25/08/2014 8:25:45 AM

I agree with David but the devil's in the detail. As a payer of a number of levies, some key questions I always have include: What is the levy being used for, how much transparency in administration and expenditure is there (.e. what was spent, where and how did it perform), what is the levy fee structure, what about opt out/in, should there be contribution scales/limits dependent upon solvency/income, does a levy always have to rise (can it be discounted/subsidised in 'good years'). Most importantly - is there a better way to achieve the same service/s or better without having a levy?
Mick
25/08/2014 8:27:32 AM

Further to my last (and most importantly), if I have to pay a levy, what are my voting rights on where my money goes/is going?
Barcoo Battler
27/08/2014 4:14:32 AM

Double jeopardy for the LNP- they have a senate inQ on Grassfed levies and they have all rounded on David for just saying - prove what the Payers of the levy want by having a quick poll.Joyce says it would cost too much for Plebiscite. Bugger me - how much would it cost to poll 37 mushroom growers in Tassie ( no more than the minister's expense account for the day.Lucky they "leaked" the cattle inq on Monday which seems to support David's aim.Peak Body Parasites- your days are numbered- start looking in the classifieds- compulsory unionism is over- boss of MLA on $480K- levy payers-$30k
jingelic
30/08/2014 2:57:32 PM

Gee whiz. I actually agree with David Leyonhjelm. Perhaps I'm losing the plot..or perhaps David's argument here runs counter to the usual libertarian BS one reads in this column. Giving primary producers a vote on the future of the levies they pay is a great idea, and a distinctly non-libertarian one at that. 'Cause what if I'm on the losing side of the vote, David? Won't my individual rights be impinged by the 'tyranny of the majority'? What would Ayn Rand say??
Jock Munro
2/10/2014 12:20:19 PM

The undemocratic nature of director appointments is taxation without representation. These bodies are rife with cronyism. All levy payers must be able to participate in an open democratic election process including nomination for election.
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Agribuzz with David LeyonhjelmCommentary, news and analysis with agribusiness consultant David Leyonhjelm. Email David at reclaimfreedom@gmail.com

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