Labor promises a new deal on compensation

23 Feb, 2001 10:00 PM

THE Federal Opposition has vowed to boost dairy assistance payments to WA, NSW and Queensland's dairying regions while shaving payments to Victoria, South Australia and Tasmania.

The move is designed to help dairy farmers most affected by dairy deregulation recover their losses.

Spurred by a recent ABARE report that found farmers in the states least affected by dairy deregulation were profiting from high compensation levels, while dairy farmers who were most affected were under-compensated, the Federal Opposition has vowed to tailor the Dairy Regional Assistance Program (DairyRAP) to replace the "one size fits all" program announced by the Coalition Government.

The Labor Party has also criticised DairyRAP funding for helping build a polocrosse field, expand a siltrock quarry and fund a wine appreciation course.

The plan to tailor DairyRAP was recently announced by Federal Opposition leader Kim Beazley and Shadow Agriculture Minister Gavan O'Connor at a meeting with 30 dairy farmers at Coraki on the NSW mid-north coast.

The ABARE report indicates WA suffered a 30 per cent drop in average farmgate milk prices in the first six months of deregulation, the biggest drop in all dairy States.

The report also indicated the forecast reduction in average farm cash income in 2000-01 was likely to exceed the average Dairy Structural Adjustment Program payments in Qld, NSW and WA.

Yarloop dairy farmer Tony Ferraro believed more was needed than just tailoring the $45 million DairyRAP scheme from which with several funding allocations have already been made.

Mr Ferraro lost a quota asset valued at more than half a million dollars on deregulation and continues to fight through the Australian Milk Producers Association (AMPA) for compensation on his lost quota asset.

He believes governments should provide the quota compensation quickly and agreed the $1.63 billion national DSAP payments were unfair because dairy farmers who didn't supply regulated milk gained from deregulation.

"We didn't want dairy farmers who were better off as a result of dairy deregulation to get a top up," he said.

"We wanted all the money to go to the farmers who were going to hurt most and some have already gone."

The ALP plans to establishing an internal inquiry to examine the impact of dairy deregulation, which would provide the party with suggestions for a "permanent fix" to problems with the current system.

However, Mr Ferraro and his sons Richard and Paul, who milk 200 cows on 400 hectares, say they are sick of inquires saying the same thing, that farmers in WA, Qld and NSW have to be compensated for loss of quota asset.

"But nobody wants to listen," he said.

"It is crucial that somebody pays up now before many more dairy farmers are forced off the land.

"With this money in hand many more farmers would be able to carry on, processors would be guaranteed a volume of milk supply and make future investments."

Mr Ferraro believed compensation could be paid out of National Competition Policy (NCP) payments of which WA was estimated to receive $45.8m this financial year, $70.8m in 2001-02 and $73.1 m for the following year, increasing to $80.2m in 2005-06.

Before deregulation WA dairy farmers held between three and 2763 litres of quota which, at the weighted price of $309.71 cents a litre, amounted to a claim of $133.2m.

The former State Government had provided $27m but none went on quota compensation.



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