TRADE and Investment Minister Andrew Robb has rejected reports suggesting he criticised the Coalition government’s decision to reject the sale of iconic Australia cattle business S. Kidman and Co to foreign buyers.
It comes with federal parliament due to resume debate on changes to the nation’s foreign investment scrutiny rules, which Queensland LNP Senator Matthew Canavan says would fix a major loophole in assessing farm-land purchases.
Reporting by Fairfax Media at the weekend accused Mr Robb of labelling federal Treasurer Scott Morrison’s decision to block the Kidman & Co sale as “political”.
Mr Morrison made the announcement late last week saying blocking the proposed sale was consistent with the Foreign Investment Review Board’s (FIRB) recommendation of it being contrary to the national interest, in its current form.
The 115-year-old cattle business holds approximately 1.3 per cent of Australia’s total land area and 2.5pc of Australia’s agricultural land while comprising 10 cattle stations covering 101,411 square kilometres in four States.
Mr Robb’s office moved to clarify the context of his quotes in the report, saying the minister did not personally criticise Mr Morrison, however the quotes were accurate.
Mr Robb said he supported the Treasurer’s decision on the Kidman transaction as it struck the right balance and proponents could recalibrate or restructure proposals in addressing any issues raised.
However, the article prompted an immediate and stinging rebuke from Shadow Treasurer Chris Bowen and Shadow Agriculture Minister Joel Fitzgibbon.
In a statement, the Labor powerbrokers said the Coalition government's handling of major foreign investments had “quickly moved from national embarrassment to open warfare amongst Cabinet Ministers”.
They accused Mr Robb of launching an “extraordinary attack” on Mr Morrison's decision to refuse applications by foreign buyers of the huge station.
The statement also repeated Mr Robb’s quotes in the article which said “I've heard about selling Australia forever - I just haven't seen a farm leave the country yet”.
In the article, Mr Robb also highlighted issues with attracting local investment into Australian agriculture.
He said Australia had “always depended on foreign investment for agriculture, because no bugger here will put money into the sector”
“You can't get an Australian investor to put money into agriculture for love nor money,” he said.
“Even sophisticated Australian investors won't put money into it.
“Agriculture is too long term for them, even though it's our great strength.”
Asked for his views on the article, Opposition leader Bill Shorten said “division and dysfunction” was at the heart of the Liberal Party.
“You've got the Treasurer of Australia saying one thing about foreign investment and you've got the Trade Minister saying something different, contradicting and indeed attacking the Treasurer,” he said.
“The government does have a right to make decisions in the national interest - I certainly agree with that - but what sort of message are we sending foreign investors when they just open the newspaper and find out what's happening?”
Asked what decision Labor would have made, Mr Shorten said Labor had learnt from the past “not to be disunited”.
“We don't have all the facts in front of us that the government's had,” he said.
On ABC radio, Mr Fitzgibbon acknowledged there could be national security issues with one section of land in the Kidman package, located next to the Woomera Protected Area in South Australia.
But he said Mr Robb’s intervention at the weekend added to the theory the decision was purely political and not in Australia's interest or that of Australian agriculture.
But Senator Canavan said it was the right decision to reject the Kidman sale and warned it highlighted the urgent need to close a major loophole in Australia’s foreign investment arrangements.
He said the Kidman proposal was scrutinised because it triggered the $252 million screening threshold for foreign investments by FIRB which the Coalition was seeking to lower to $15m in the Foreign Acquisitions and Takeovers Legislation Amendment Bill that’s before the Senate.
“Individual properties in the Woomera Prohibited Area in South Australia would not come close to reaching the $252m threshold,” he said.
“So even though this is a sensitive area on national security grounds it would not trigger the automatic FIRB requirement unless the sale was part of a much larger deal, like the Kidman one.
“It is vital that this change be passed so we can close this loophole as soon as possible.”
Senator Canavan said Labor had rejected widespread community concerns by urging a $1 billion threshold for any FIRB scrutiny on foreign investment proposals for Australian agricultural land.
But he said after realising this position “made no sense” they made a new proposal for a $50m threshold “but this is still far too high given Australian agricultural land values”.
Debate on three Bills before the Senate also seek to lower FIRB scrutiny on foreign agribusiness proposals to $55m and ensure the $15m threshold on farmland can be applied accumulatively.
During debate on the legislation earlier this month in the Senate, NSW Liberal Senator Bill Heffernan repeatedly interjected in a speech by Labor Senate leader Penny Wong asking her to define the difference between corporate and sovereign foreign investment.
But Senator Wong said the government's position had “no public policy rationale”.
But Senator Canavan said Labor needed to review their opposition to the proposed changes to FIRB scrutiny and clarify whether they would have allowed the Kidman sale to proceed.
Fairfax Media has also reported that Chinese investment firm Genius Link Asset Management was believed to have been the highest bidder for the Australian cattle station after rival company Shanghai Pengxin made a $350 million bid.