Inquiry into the Agriculture (Biosecurity Protection) Levies Bill 2024 [Provisions] and related bills
Senate Standing Committees on Rural and Regional Affairs and Transport
Public Hearing – Tuesday 23 April 2024, 9.30am-10.00am
Thank you for providing Grain Producers Australia with the opportunity to present the views of our grain producer members to this inquiry.
GPA has responsibilities for all 22,500 levy-paying producers on biosecurity, though our roles to Plant Health Australia and as the signatories to the Emergency Plant Pest Response Deed (EPPRD).
This combines with our other representative roles and responsibilities for growers on the levies they also pay for funding RD&E investments and the National Residue Survey.
Since the budget announced this new levy proposal in May last year, GPA has called for more details and clarity, to try to understand how this policy impacts our members, and whether it’s actually fair and equitable.
This announcement completely blindsided GPA and our members, with our Chair Barry Large stating at the time ‘the devil’s in the detail’ of this move to impose a new levy on all grain growers.
It was impossible to believe that this funding to be taken directly off farmers and redistributed into government consolidated revenue was in fact ‘modest’ or part of a ‘sustainable’ biosecurity funding model.
Especially given no policy analysis was provided to show how this 6pc compared with all of the other levies that producers already pay – state and federal – and the costs incurred within their own businesses, to manage pests and weeds.
In particular, this announcement failed to account for the emergency biosecurity levies that producers also pay – including for the costs of varroa that we’ve been dealing with since July 2022, along with actual production losses that producers have incurred.
This 6pc may have been ‘modest’ to those who decided to implement this new levy/tax on all Australian farmers– but no effort was made to ensure it was actually fair and equitable for the producers being asked to pay it.
To date, we still haven’t seen any details of these critical comparisons and policy justifications as to why producers are the only ‘beneficiaries’ who should be paying this new tax/levy, compared to others across the supply chain or the community.
At the time of last year’s budget announcement, ironically, GPA was undergoing internal processes to review our current levy rates to see if they were fit-for-purpose and if we could change rates and allocate a modest 0.06pc of our current levies into stronger biosecurity protections.
This new levy and other factors have completely sabotaged our ability to conduct broader consultation on this review and to try to fund the Grains Biosecurity Plan, to strengthen biosecurity and the multiple shared benefits these deliver across the community, environment and economy.
Since the 2023 budget, very little detail has been provided that’s been able to convince our members that this proposal is either fair or equitable.
A range of independents experts have also examined the proposal and failed to support it – along with the lower house MPs and independent voices who voted against it, after scrutinising the policy’s finer details, on merit.
This inability to win any genuine support from the producers who are being asked to pay more in levies, and many others, shows quite clearly this policy has been born out of a substandard consultation process, which would not pass any basic standards for accepted social licence principles.
Consultations on the BPL have also been conflated with other processes relating to levies and biosecurity, including the 2022 Senate Biosecurity, which did not recommend a new levy on all agricultural producers and the ‘modernising’ ag levies process.
GPA has long supported a move to introduce a container levy as recommended by the Craik Report in 2017, so the risk creators can contribute more to shared responsibility and accountability.
This was also advocated and supported in the 2022 Senate Biosecurity inquiry.
However, even today, we still have no idea where this policy proposal is at – despite repeated promises to implement it, by the former and current government.
There’s also no analysis or economic modelling to show why producers are being regarded as the only ‘beneficiaries that should be forced to pay more in levies, whilst other supply chain participants, who clearly benefit from strong biosecurity, are not even part of the conversation.
These participants also benefit greatly from the hundreds and millions of dollars that producers contribute in other levies, to support long-running investments on RD&E – but they’ve not even been considered or counted, as part of the BPL policy.
One easy step for the government to resolve this matter would be to look at the source of the claimed 1.6 million jobs across the agricultural supply that the ‘sustainable’ funding will apparently protect, that’s been made in the Agriculture Department’s submission to this inquiry, and identify these other beneficiaries and look at how much of the supply chain they control.
Ironically, at the same time producers are being made to pay another levy, other inquiries and processes have been initiated to try to see if farmers can actually get a fair share of the retail dollar with improved competition settings and policy – to prevent misuse of market power.
For GPA, grain producers are price takers and can’t pass on these costs along the supply chain.
As our submission shows, we’re also a low value commodity which creates an economic multiplier effect across the economy, getting only 0.20 cents from a $15 beer.
Our existing levies generate many other shared benefits for the nation – including environmental and economic gains through increased tax generation, but these costs can’t be passed on.
GPA’s submission clearly outlines these important economic principles and demonstrates the clear failure to recognise and consider these key factors, in the biosecurity levy proposal.
We clearly take biosecurity seriously given the significant sums we already pay in levies to fund a range of activities, initiatives and partnerships, to deliver shared benefits.
GPA remains staunchly opposed to the new levy/tax these bills are seeking to introduce, to redirect funds off Australian farmers, to go into consolidated revenue and replace general taxation revenue.
Despite recent changes, this policy still fails to pass the fairness and equity tests and this fatally flawed proposal is directly linked to the substandard consultation processes which led to its shock announcement in May last year.
Quite simply, if the original policy design and ‘consultation’ is clearly insufficient, then the subsequent policy can only be deficient – and that’s why this new levy-tax on farmers has not won their support and why so many stand strongly opposed to it being implemented.
Thankyou.
GPA Chief Executive, Colin Bettles.