MPCI stamp duty call unheeded

28 Mar, 2014 01:00 AM
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Muntadgin farmer Jeff Hooper supports the removal of stamp duty on crop insurance payments.
I don't think that it has been supported by the Treasurer, so we have to be still asking questions a
Muntadgin farmer Jeff Hooper supports the removal of stamp duty on crop insurance payments.

A CALL by a group of WA Nationals MP's to remove stamp duty payable on Multi Peril Crop Insurance (MPCI) products appears to have gone unanswered.

WA Nationals members representing the Agricultural Region, Shane Love, Mia Davies, Martin Aldridge and Paul Brown called for the waiver in September last year in an attempt to ensure the availability of MPCI products in the market place by this year.

At the time, the group said the removal of stamp duty payable on MPCI products for two years would allow the market to mature and would improve uptake as new products were developed.

And further, they said swift action from the government on the matter would encourage more farmers to take out insurance for this growing season.

The Nationals WA?deputy leader Mia Davies wrote to Agriculture and Food Minister Ken Baston calling for the stamp duty on multi-peril crop insurance (MPCI) products to be waived in a bid to provide financial confidence to growers ahead of the 2014 growing season. The issue was then referred to the Treasury for advice.

Now six months later and it appears the proposal has fallen by the wayside.

According to The Nationals WA MP Shane Love, the proposal had not been accepted by the State Government.

"At this stage no, although we are still pushing for ways for Multi Peril Crop Insurance to be brought into the State," Mr Love said.

"It doesn't seem to have any legs.

"I don't think that it has been supported by the Treasurer, so we have to be still asking questions about that.

"But at the moment, there is not any clear indication that it is going to happen, in fact it is probably the other way round."

Last September, Ms Davies said the initiative would complement the measures designed to assist farmers better manage risk that were outlined in The Nationals 'Seizing the Opportunity' agricultural policy.

She said as part of the $300 million policy, The Nationals WA were committed to investing to help grain growers to better manage risk, including expanding the weather network station.

And access to more accurate information would assist in the development of a variety of crop insurance products.

In his role as previous Agriculture and Food Minister, Terry Redman defended his decision to implement the weather station network in 2012.

The network used technology that MPCI company Swiss Re and its US partner The Climate Corporation labelled "yesterday's technology", and supported government funding for Doppler Radar Technology (DRT).

According to Shane Love, the Nationals WA supported the technology that was needed to support MPCI information gathering.

When asked if that included DRT, a major determining factor surrounding the investment in MPCI in WA by Swiss Re, Mr Love said meetings with meteorologists assured him that the digital radar currently in place was sufficient for the task.

"What we have been told is that our new digital radar is basically what you would install if you were installing DRT," Mr Love said.

"The only thing that DRT does is look at movement in terms of wind and that is just a relatively simple add-on to the radar that is currently being deployed.

Last year Agriculture and Food Minister Ken Baston said while he did not support subsidising private insurance companies, he did support the roll out of DRT if the funding was available at the time.

But despite the relatively small $2 million price tag, the Liberal's agricultural policy did not include any funding for DRT or MPCI last year.

A spokesperson from the Minister's office said the matter was still with Treasury.

Farm Weekly asked Mr Love if The Nationals WA would continue to push for the $2m to be spent on DRT technology.

"Yes, but it is not in the budget, it's in the forward estimates," he said.

"It is $297m of agricultural expenditure in the budget and in the forward estimates going forward and this is part of that."

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READER COMMENTS

boris
28/03/2014 7:40:27 AM, on Farm Weekly

The WA Treasurer should never give an exemption to stamp duty for any individual insurance product unless it is an exemption across the board or a scrapping of stamp duty altogether - never likely to happen. This howling from the Nats is typical of politicians representing agrarian socialism. Farmers need to manage their own risk and not rely on exemptions or bail outs like everyone else in society. When a MPCI product comes to the market it has to face the same market forces and government costs as every other product. These products are generally cost prohibitive which reflects ag's risk.

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