SPEAK NOW OR PAY LATER: WA GROWERS URGED TO BACK LEVY CHANGE

WA Farmers Grains Council President Mark Fowler spoke with ABC WA Country Hour journalist Belinda Varischetti about why Western Australian growers should take part in the Grain Producers Australia survey on proposed changes to the components of the grain levies.

The review marks the first time in history that growers can have their say on levy rates, including the portion paid to the GRDC for research and development.

Fowler urged WA growers to engage in the process, saying that while many support a deeper cut than the 20 per cent reduction proposed nationally, the best way to influence the outcome is by voting and adding comments.

[Belinda Varischetti] 

WA grain growers are being urged to participate in a survey to help determine the future of the levy rate paid to the GRDC for industry research and development. For the first time in history, Grain Producers Australia is running a poll on the levy system and proposing a 20 per cent reduction in the R&D component of the levy, well short of the 50 per cent reduction WA grain grower lobby groups are calling for.  

GPA says the levy rate hasn't changed since 2008 and GRDC is now sitting on a reserve of $730 million, with more record grain production and levy collections forecast this harvest. 

Mark Fowler is President of the WA Farmers Grains Council. Mark what response has there been from WA growers to this survey? 

[Mark Fowler] 

I believe every grower I speak to supports the position that has been adopted by WA Farmers, PGA and WAGG. What we're concerned about, is that even though growers support us in this policy position, they're not necessarily engaging with the process. It's really important and I would urge all WA growers to get involved with this process, because we're not going to see any change unless they do. Growers really need to understand that what other states think about this is not necessarily the same as WA growers feel. 

So we're only 10 per cent of the nation's growers by number, but yet we export around half the country's grain and pay a very significant proportion of the GRDC levies. So it's really important that WA growers engage with this process. There is an important point here that we've been calling for a much deeper cut than what has been proposed by this process but, people need to understand that this process is the product of a national consultation with all of the other states and the fact that the cut isn't being proposed to be as deep as WA wants is reflective of a national compromise in a sense. 

So we think it needs to be much deeper and much sooner, and we don't think the net change of 14 per cent, which is 20 per cent minus the 6 per cent biosecurity adjustment, we don't think that's nearly enough. In fact, it won't even account for the extra tonnes that WA grows this harvest. But to give the best message to the Minister, I would implore growers to vote yes because it is a change in the right direction. 

We do want to see the levy reduced, but in the additional comments growers can set out the sort of cut that they would like to see. So, if you want to see a cut in the order of magnitude of 50 per cent or thereabouts, then say so and that will be taken into account. 

[Belinda Varischetti] 

Well that's probably why the response is what it is at this point though isn't it? The WA grain grower group's calling for a 50 per cent cut and as you're describing it, it's in reality Grain Producers Australia calling for a 14 per cent cut. That's a huge difference and maybe that's why they bothered to get it done. 

[Mark Fowler] 

Well there is some talk around people voting no to show their objection to where this has landed. Now I would urge people not to do that, because that will be misinterpreted as saying you support the status quo. If you do support the status quo by all means vote no, but if you don't support the status quo, and you think there needs to be a significant cut to the levies at least immediately to get those reserves down, then you need to vote yes and say so in the comments as to the depth of cut. because it's all going to be relevant and all taken into account. 

[Belinda Varischetti] 

Why wasn't there sort of multi-choice about this sort of a 20 per cent, 30 per cent, 50 per cent cut? Was that an option at all or discussed at all? 

[Mark Fowler] 

Well it's something that some of the states wanted to see. We thought it'd be worth including as well, but I don't think the nature of the process supports it. There's quite a prescribed process to go through and you need to have a mandate based on the process to affect the change and, if there was a spread of different options you wouldn't have sufficient weight to make a decision one way or another as to what you supported. 

We did try to make the case that if say a third of growers supported a 50 per cent change, and the rest wanted a 25 per cent change, or that obviously the people that support a 50 per cent change they clearly obviously also support a 25 per cent change, but that's not the way the process has been played.  

What I do understand is that once we can establish a process for review here that works and actually is carried out, it's actually quite foreseeable and indeed planned, that there'll be another review started straight away to seek further change. This levy hasn't been changed for a very long time and it seems to be a little bit hard to change and we need to establish some greater fluidity in that process. Once this process has been used for the first time, once that's been used and works and demonstrates it works, then it's something that can be used again. 

[Belinda Varischetti] 

Have you got any idea of the numbers of growers who've participated from Western Australia so far? 

[Mark Fowler] 

I would assume, I haven't asked the question, but I would assume that being an independent survey that they wouldn't be able to disclose anything until the conclusion of the survey. It's an independent survey. 

[Belinda Varischetti] 

So how do you know there's been a poor response at this stage? 

[Mark Fowler] 

I don't know there's been a poor response, but I get the sense talking to people around the place. There's a series of webinars that are being run by Grain Producers Australia. There's a set of workshops being run by Grain Growers Limited. I understand the turnout to the Grain Grower Limited meeting's been relatively poor. 

The turnout for the GPA webinars hasn't been that strong, particularly from WA, which is surprising. So this is a bit of a phenomenon unfortunately. There's a lot of grain growers and probably farmers who generally feel as though someone else is going to do the vote and there'll be enough of a groundswell. 

The reality is... 

[Belinda Varischetti] 

Well maybe they're happy with the status quo. 

[Mark Fowler] 

That is possible, but they would equally could have voted no in that process. Our experience with growers generally, with CBH elections, with grower representative membership and participation, is a lot of growers think someone else will do this for me. I don't have to do this and I would say that because we're quite small in number as WA growers, if you look at what you pay annually to GRDC and you're not happy with that you need to do something about that by engaging in the process. 

It's a one-page proposal and the explanatory material is right there. You just need to vote and there's an additional comments block, so it's a case of just ticking one box and then any additional comments that you want to put in and the job is done. 

You put in your NGR number and the job is done. 

[Belinda Varischetti] 

Can the result of the survey actually affect change? 

[Mark Fowler] 

Yes, yes. It's part of the ministerial guidance around how you change a levy. There's seven or eight or nine steps that you need to go through and if you can demonstrate enough of a case by in terms of weight of support for the proposal and robustness of the sampling system, then you will have enough of a case for the minister to make a decision without going to a full poll of levy payers. 

If we do not get enough engagement via this process, then it will go to a poll of all levy payers and then the problem with that for Western Australia as I've mentioned before is that Western Australia is only 10 per cent by number of the nation's grain growers. 

[Belinda Varischetti] 

Mark, last month you wrote to the minister, Julie Collins, you and the other main grain grower lobby groups here in WA calling for an immediate 50 per cent reduction in the grower levy paid to the Grains Research and Development Corporation. Has there been any response from the minister? 

[Mark Fowler] 

Not to my knowledge. 

[Belinda Varischetti] 

Is that disappointing? 

[Mark Fowler] 

I would say the main purpose of our letter was to articulate the very strong viewpoint of the grower representative bodies in Western Australia. It is completely foreseeable that the minister has said well look there's a levy review process that is underway, let's see what that says and hopefully our letter helps inform that process and two of the key messages in that letter, was firstly to not proceed with the implementation of the right size review recommendations, which was to spend $60 million extra per year to try to spend the reserves down. The other aspect was that we would urge the minister to act on this as soon as is possible because we obviously have harvest coming up very soon. There will start to be payments made pursuant to contracts which will involve the deduction of GRDC levies, so there's an urgency here. 

We're looking at maybe our biggest crop ever, so we're going to see a lot of extra revenue. I'm in the back of the envelope it looks like there could be $100 million coming out of Western Australia. Just from WA alone, the extra levy take from that extra 6 million tonnes above our now, I think it's about a 19 million tonne average, is way more than the reduction that we're proposing to the GRDC levy and that's why it's important that the cuts are deeper and more immediate, because otherwise we're just going to add a whole lot of extra money to those reserves. 

[Belinda Varischetti] 

Mark, great to talk to you. Thank you. 

[Mark Fowler] 

Thanks Belinda. 

[Belinda Varischetti] 

That's Mark Fowler, President of the WA Farmers Grains Council urging WA grain growers to take part in a survey. Doesn't matter which way you vote, but as long as you vote is kind of the point Mark's making. Take part in that survey to help determine the future of the levy rate paid to GRDC for industry research and development. 

Vote now - Your levies, your rates, your say