$12m Single Vision levy plan

25 Jan, 2005 10:00 PM

AUSTRALIAN grain growers could soon be paying another $12m in levies for a multi-layered national industry body to implement the Single Vision strategy.

Details leaked to Farm Weekly indicate the new company would be called Single Visions Grains Australia Ltd and include A, B and C Class shareholders.

There would be one board for the parent company, and one for each of the two subsidiary companies, which would focus on networks and strategic investments.

The proposed new national industry development company, developed in response to the Single Vision grains industry strategy, would be funded by a 0.2pc increase in the Grains Research and Development Corporation (GRDC) levy.

The 1pc levy to GRDC brings in about $60m a year and the extra 0.2pc, not matched by Government, is expected to bring another $12m to run Single Visions Grains Australia and its two subsidiaries.

Farm Weekly understands that the Grains Council of Australia (GCA) has received approval for the new proposal from all its members except the Victorian Farmers Federation (VFF) and WAFarmers.

There are understood to be concerns about funding provisions in the proposed company's network and for reference implementation groups because they could potentially sideline state farm organisations (SFOs).

While it's understood the proposal included a requirement to make funding available to SFOs to implement the strategy, some SFO members believed they would end up handing a lot back in the form of membership fees for the new company.

Under the draft plan, GCA members would receive Single Vision Strategy implementation support to the value of $150,000.

There is also a view the proposal should be put to growers before it is approved by the GCA and the federal agriculture minister.

The ultimate aim of Single Visions Grains Australia is to lift producers' share of the grain dollar up from the existing 19 cents to 30c.

Under the proposal still being finalised, the Single Visions Grains Australia parent company would receive about $2m, its national strategic network $2.7m and strategic investment company about $5.5m.

GCA would also be able to apply for up to $750,000 of the parent company's budget for national policy development and representation work.

The strategic network is expected to comprise 10 regions, each having six producer advisors elected every two years.

There would also be eight reference groups, mainly involving participants in the grain production chain, which would receive information from task groups that had research and reporting roles.

The reference groups, likened to standing committees, would focus on areas such as communication, biotechnology and demand, research and development, infrastructure, environment and investment.

Single Visions Grains Australia, with a structure modeled along the lines of Dairy Australia, would have A Class shares for levy-paying growers who are owners of the company.

Voting entitlements would be based on the levies they paid with an additional vote for every $250 in GRDC payments.

The B Class shares would be available for SFOs, commodity traders or shareholder groups, while C Class shares would be allocated for corporate entities in the value-adding chain.

It is not envisaged that Single Visions Grains Australia would be part of the GCA, which is contemplating a restructure and name change to The Grains Council.

The proposed modifications to GCA, making it a company limited by guarantee like Single Visions Grains Australia, could be carried out and put in place after the annual Grains Week conference in early April.

Under its constitution, the GCA would have had to be wound up earlier this month if WAFarmers had not rejoined GCA after a dispute over the Iraqi wheat debt.

Meanwhile, GCA chief operating officer David Ginns was tight-lipped about the plan, denying there were proposals to increase the GRDC levy by 0.2pc to fund the Single Vision strategy.

One grower contacted by Farm Weekly said he would gladly pay the levy because it would only amount to 40c a tonne, at $200/t, and that SFOs did not have enough financial power take on national issues alone.

The grower, who did want to be named, said that in the context of a $10 billion grains industry, the extra $12m was insignificant.



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