Australia: No significant reprioritisation for agricultural sector

"This Budget is a serious commitment to agriculture, with funding to implement our plan to make farmers stronger, better prepared for the future and with access to more opportunities": Minister for Agriculture, Fisheries and Forestry, Senator Joe Ludwig.1.

Reforms aimed at strengthening regions and producing more resilient rural communities include:

  • a $420.0 million Farm Finance package to support and assist farmers experiencing debt, providing concessional loans, rural financial counsellors and a better approach to debt mediation
  • a $99.4 million Farm Household Allowance over four years as part of the National Drought Program Reform. This funding is aimed at helping farmers assess their business and manage related risks, such as drought, through improved options for farm business training and better risk management tools
  • $238.2 million for research and development corporations, including $5.9 million in 2012-13 to Charles Sturt University to support the Food, Soil and Water Research Centre project
  • investment in Australia's biosecurity system program, including $379.9 million for the construction of a post-entry quarantine facility (although this spending was already announced in the 2012-13 Budget); and
  • almost $1 billion of investment in the Regional Development Australia Fund supporting the infrastructure needs and sustaining economic growth in Australia's regions. This continues the rollout of the Regional Development Australia Fund and builds on the first two rounds which invested $350 million to leverage projects worth $1.2 billion.

There is a range of other rural related measures announced in the 2013-14 Budget, with water resources featuring prominently. Many of the measures are, however, a continuation of existing programs, with the cost of several of them being met by redirecting funding programs such as the Restoring the Balance in the Murray-Darling Basin program and the Water for the Future initiative. By way of example, $94.5 million over five years is provided to support the implementation of the Tasmanian Forests Agreement, the cost of which will be partially met from redirecting funding from the Biodiversity Fund and the Caring for our Country program.
The Budget also includes:

  • a commitment of more than $4.8 billion under the Sustainable Rural Water Use and Infrastructure Program for infrastructure upgrades to secure the future of irrigated agriculture in the Murray-Darling Basin and beyond; and
  • $3.5 billion over twelve years to support the implementation of the Murray-Darling Basin Plan, including initiatives to increase the amount of water available for productive use (by 650 gigalitres) through water offset projects, while achieving equivalent environmental outcomes to those contained in the Basin Plan.

The response of the agriculture sector since the surplus-focussed 2012-13 Budget has been that agriculture has fallen off the national agenda and needs to be reprioritised. In its Federal Election Policy Priorities 2013 paper, the National Farmers Federation (NFF) outlined 5 key priority areas that it intends to use to scorecard Federal political parties on their commitments and policy developments in the lead up to the Federal election later this year. Those priority areas include:

  • Growing Australian agriculture by reprioritising agriculture within the Commonwealth Government and on the national agenda and committing to large scale blueprint policies for the future of Australian agriculture
  • Investing in research and development to establish Australia as a leader in international rural research and committing to the national northern Australia development plan
  • Increasing competitiveness and profitability by reviewing terms of trade, committing to a comprehensive drought policy package (including measures to build self-reliance and resilience), improving ageing rural and regional infrastructure, completion of trade agreements to improve trade and market access and strengthening Australia's biosecurity regime
  • Building a stronger workforce by embedding agriculture in the national school curriculum and encouraging flexible work policies that benefit rural industry; and
  • Balancing agriculture and the environment by applying a balanced and consistent approach to land and water management, improving opportunities for on farm stewardship and enhancing opportunities to underpin agriculture's climate resilience.

Senator Ludwig appears to have responded directly to these priority issues in his Budget media release. In particular he has announced increased funding available under the Farm Finance package and the Farm Household Allowance funding under National Drought Program Reform. However, the NFF may criticise the priorities and scale of the Budget response. The 2013-14 Budget does not provide any significant reprioritisation of the policy position for agriculture.

In his media release, Senator Ludwig also states that the Budget demonstrates the Government's plan for Australian agriculture to keep "feeding Australians and feeding the world". The Federal Government has previously stated in its Australia in the Asian Century White Paper that it intends to exploit the growing Asian food market by "lifting productivity to increase output and capture value-adding opportunities". The stated pathways to achieving this goal are:

  • Continuing Australia's strong track record of investment in research and development
  • Encouraging industry investment in response to emerging business models by creating a supportive operating environment through deregulation and tax reforms
  • Investment in public and private sector infrastructure for transport, energy, communication and water
  • Developing sustainable food production methodologies and 'clean, green and environmentally friendly' credentials; and
  • Maintaining the health of natural resources, including soil and water, through environmental regulation reform.

Although the Budget provides some measures to open these pathways, current funding for research and development and improving infrastructure appears to be insufficient for the cultural shift required to meet the Government's policy goals. There is no apparent funding allocation to address land use conflicts to balance the interests of the energy and resources sectors and agriculture or to develop the northern Australia food bowl plan in the immediate future.


1 Minister for Agriculture, Fisheries and Forestry, Senator Joe Ludwig - Media Release - 'The Gillard Government's plan for Australian agriculture' dated 14 May 2013.

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