FEDERAL Treasurer Scott Morrison’s first federal budget offered little buzz or excitement for Australian agriculture but it also avoided delivering any major shocks.
Last year then Treasurer Joe Hockey’s second budget made regular and glowing mention of farmers in delivering a series of welcomed measures like accelerated tax deduction for new assets such as water and fodder storage.
That budget arrived on the verge of the first ever Agricultural White Paper being delivered but this year Mr Morrison made scant mention of the agricultural sector which matched the lowly pre-budget hopes of seeing any starting fiscal revelations.
With a federal election due to be announced within days, National Farmers Federation President Brent Finlay said this year’s budget was one that was appropriate for the mood of the time.
“The budget is fully funded and there are no surprises in it but there are no big pots of money anywhere,” he said.
“It’s all about preparing the ground for the election campaign that will go for eight weeks.
“Some things are already popping out now and other announcements will be released during the campaign.”
Mr Finlay welcomed the delivery of $594 million to advance the inland rail through land acquisitions but would have preferred a bigger sum for the nation building Brisbane to Melbourne project.
“We need to see shovels going into the ground to build the inland rail which we’ve been talking about for so long,” he said.
Mr Finlay said the government’s plan to allocate the inland rail funds to the Australian Rail Track Corporation over three years from 2017-18 for pre-construction and due diligence activities, was another positive budget outcome.
He also praised the delivery of $15.9m over four years to build a new Biosecurity Advanced Analytics system citing the importance of biosecurity to safeguard the farm sector and in facilitating export trade.
He also welcomed the $2 billion water infrastructure fund loan facility and $7.1m over four years to boost the Rural Financial Counselling Service but was highly critical of the Treasurer’s lack of commitment, to reverse the backpacker tax increase.
“This is a massive issue for Australian agriculture,” he said.
The budget said it would also save $9.2m over four years by making changes to the $20m Managing Farm Risk Program delivered in the White Paper.
The government said it would now introduce a means test to limit eligibility for the program to farm businesses with annual revenue of less than $2m.
The MFRP provides rebates of up to $2500 to help farm businesses with the costs of advice and assessments on eligibility for multi-peril crop insurance, to assist them managing drought and other production and market risks.
The budget papers said the program was now being delivered by the Department instead of by the State governments, providing administrative savings.
“Consultation with industry suggests that demand at the time of the White Paper may have been over-estimated,” it said.
“There are adequate funds available under the revised allocation to meet expected demand over the life of the program.
“The savings from this measure will be redirected by the Government to repair the Budget and fund policy priorities.”
But Mr Finlay questioned whether the government had overestimated the program’s demand at the outset, “or did they not quite, get it right”.
“We need to look closer at that particular budget measure,” he said.
“However there’s no doubt agriculture needs some form of farm protection insurance to help manage production risks.
“We need crop protection but also an insurance scheme for livestock production or whole of farm risk protection or even income protection insurance for farmers which you can get in other industries but not ours.”
