How to get rural issues right

THE diversity of opinion within the Federal Coalition is shaping up to be a critical factor in terms of agricultural policy.

So far, there appears to be a middle ground approach between the free marketing philosophy of Liberal tradition and the agrarian socialism of the Nats, and it’s seen some good policy on issues such as foreign investment in agriculture.

The figure of a $15 million cumulative trigger for the requirement of Foreign Investment Review Board (FIRB) approval for farmland and the set up of a foreign ownership register of farmland is a sensible approach.

We definitely need the boost that foreign investment can give our agriculture sector, yet there’s certainly no harm in having investment decisions vetted, and also of having some idea how much farmland is in foreign hands.

We suspect it will show up to be somewhat of a mountain out of a molehill, with the vast majority of ground remaining Australian owned, but it will be nice to have a clearer picture of what is happening in that sphere.

Yet you get the feeling the decision sits awkwardly with the extremes of both sides of the Coalition – some wanting the full laissez faire liberalisation of the market, and others from the Nationals wanting stricter controls on foreign investment.

With this in mind it is going to be interesting to see how the Coalition plays a similar issue of the amount of regulation required in the debate surrounding the upcoming Wheat Marketing Act, in particular the future of Wheat Exports Australia (WEA).

The National Party, in particular Barnaby Joyce, has been vociferous in its support of retaining WEA. The Liberals have been equally deafening – in their silence. You get the feeling many Liberals feel more natural affinity with Labor’s position to do away with the regulator than the stance of their National Party brethren.

It’s one of those issues that highlight the uneasy alliance between two major conservative parties on certain economic policy.

Already, there is mainstream commentary speculating on Tony Abbott’s ability to keep all the disparate elements of his alliance happy regarding agricultural issues.

As far as we are concerned, the foreign investment policy is a nice piece of consensus decision making, but its going to take a skilful effort from Mr Abbott to negotiate a similar outcome on wheat marketing.

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READER COMMENTS

dumbfrmr
13/08/2012 7:10:46 AM

Australia is knackered as far as farming and manufacturing go. Hey, even tourism is suffering. Can someone explain to me what the pro and cons are of dropping our dollers value. Surely this would increase our competitiveness. Seems to work for China?
PAYG
13/08/2012 7:06:49 AM

Probably the most important issue missing from this opinion piece is the fact in defining ‘Foreign Investment’ as opposed to ‘Foreign Government Investment’. Given that Foreign & Sovereign Governments have the power to print their own currency, it would then follow that if ‘Foreign Government Investment’ is considered or defined as ‘Foreign Investment’ in agriculture land then the lampooning of the libertarian free-market is complete and assured.

Definitely a fair call there - sovereign wealth funds and the like need to be treated as a totally different kettle of fish as far as I am concerned

Posted by moderator: Gregor Heard on 13/08/2012 10:10:42 AM
Jeff
10/08/2012 2:50:15 PM

Lets talk about the automotive manufacturing industry in AU which reportedly employs 50,000 directly and another 200,000 indirectly. Collectively they are probably paying paying income tax of say $2.5bn annually. How do we replace that level of revenue if the industry folds? isn't it worthy of govt support?

For mine Jeff its just a matter of throwing good money after bad. I recognise the need to have a strong manufacturing sector, but target industries where there is the possibility of being internationally competitive, ones where we've got a natural advantage. Value adding our natural mineral resources and food processing are areas that could be sustainable - and then you could see people employed, and paying their taxes, working in an industry that is sustainable.

I'm obviously biased, working in the industry but I think in terms of return on investment and job creation the amount of money being thrown at some sectors of manufacturing you'd get far more bang for your buck supporting agriculture - not in terms of subsidies propping up farmers who aren't viable, but in terms of opening up new markets for our products and adding to productivity.

Posted by moderator: Gregor Heard on 10/08/2012 3:03:10 PM
Jeff
10/08/2012 12:43:07 PM

Gregor, isn't it the obligation of each elected member, be they Nat or Lib (or ALP etc) to represent the vested interests of THEIR constituents? Secondly, everyone accepts the psychological torment of having to walk off the farm. But what about the SME owner who also gets shafted by a range of domestic and international pressures (beyond his industry's control) and loses the family home? As far as subsidies go, that appears to be a much fairer comparo than AU vs EU. Lastly, is your post supposed to be an opinion piece or factual reporting?

First and foremost Jeff - everything that I file as a blog is my humble opinion - that certainly don't make it right every time! The idea is to raise issues I feel are important and spark a bit of debate.

Everything I write as a news story, however, I attempt to be as impartial as possible. So that's how it all works.

Onto your comments - I am certainly not against small businesses, far from it, but I fail to see how allowing multi-nationals to literally take the money and run is beneficial to our nation's economic health. I realise there will be some constituencies that hurt disproportionately as a result of support being eased, but Australia needs industries that can stand on their own two feet.

Posted by moderator: Gregor Heard on 10/08/2012 1:47:14 PM
MACCA
9/08/2012 7:45:17 AM

To all politicians and parties, instead of wasting time and effort on what might happen on foreign investment, why not give certainty and security to Australians and countrymen who have already INVESTED in this nation,

Righto - let's clear things up. Mark - I am using the good ole royal we in this case! Jock - you and I differ on quite a few issues, but I whole heartedly agree that the free market philosophy of the Libs v the Nats has the potential to very damaging.

Bushie Bill - I'm pretty much over this agrarian socialist line - Australian farmers have the diesel subsidy helping and that's it. Compared to international rivals its a drop in the ocean. I also don't understand why farmers are always the first ones in the gun calling out for handouts when we have governments at both levels more than willing to prop up a car manufacturing industry that is uncompetitive and unwilling to make the necessary investment to become so.

Posted by moderator: Gregor Heard on 9/08/2012 8:22:12 AM
Bushie Bill
8/08/2012 6:39:49 PM

Agrarian socialists once wanted only Australian taxpayers and consumers to subsidise them; now they want their fellow dirtkickers to chip in to compensate for their inability to compete, to be inventive, to be innovative and to take on the challenges of life without “big brother” guaranteeing them.
Bushie Bill
8/08/2012 6:38:46 PM

It is not the Libs (or the government for that matter) that has been deciding to" sell off the farm"; it is individual and corporate owners who decide to sell. These are people just like you Jock. Do you want to take away their right to make their own decision on a legally-held asset? Would you be prepared to contribute to compensating sellers' for their potential losses? Would you accept willingly the prospect of not being able to dispose of your asset to anyone you chose?
Jock Munro
8/08/2012 4:46:35 PM

The Liberals are well and truly 'on the nose'in Rural Australia. They will never be forgiven for voting down the single desk with the Rudd Government. As time goes on and the deregulated wheat industry continues to exhibit all of the bad characteristics that were predicted, the hatred for the Liberals will increase. Tony Abbott ,who told several distraught wheat growers on the day the wheat industry was deregulated, that lowering the price of wheat would be a good thing, might well be picking up on the bad vibes. Not surprising that most Libs would sell off the farm.
mark2
8/08/2012 4:37:18 PM

who's "We", Gregor?
Grain of TruthRural Press grains writer Gregor Heard on the big issues facing the broadacre farmers today.

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