Chapter 3 - Agriculture, Fisheries and Forestry portfolio
Department of Agriculture, Fisheries and Forestry
The committee heard evidence from the department
on Tuesday, 14 February 2006.
The hearing was conducted in the following order:
Management Services and Corporate Policy
Food and Agriculture (including Wheat Export
Product Integrity, Animal (including aquatic
animal) and Plant Health
Australian Quarantine and Inspection Service
Australian Bureau of Agriculture and Resource
Bureau of Rural Sciences (BRS)
Rural Policy and Innovation
Fisheries and Forestry
Natural Resource Management
In his opening statement, the chair repeated the
comments made on the first day of hearings in relation to the lateness of
answers to questions on notice. No answers were received from DAFF by the due
date of 16 December 2005.
The majority were received on the Friday afternoon before this hearing, with
the remainder sent on Monday afternoon, 13
This was also an issue during questioning of the
Fisheries and Forestry division. Officers indicated that questions asked by the
committee had already been answered as part of written responses to questions
on notice from the previous round of estimates. However, due to the late
submission of these answers, committee members did not have time to go through
them. The secretary of the department expressed regret at the delay and
undertook to 'do better next time'.
Minister's opening statement
The hearing began with the following statement
by the minister, Senator Abetz:
The government has directed that officials appearing before
Senate legislation committees should not answer questions directed to them on
matters before the commission of inquiry being conducted by the Hon.
into certain Australian companies in relation to the oil for food program.
While examination of officials by the committees might be appropriate in the
future, the government believes that it would be in the public interest for Mr
Cole to be able to proceed with his inquiry
and present his findings without parallel public questioning that would not
assist consideration of complex issues.
The committee questioned the minister about the
basis for purporting to direct officers from a statutory authority. The minister
replied that those in independent statutory authorities are under the CAC Act
and therefore not subject to ministerial direction.
The committee also explored the use of the
phrase 'parallel public questioning' and whether the ban would still apply if
the committee decided to hear this evidence in camera. The minister said that if
there was a departure from the normal process of conducting estimates hearings
in public, the government's position would be considered at that stage.
The secretary of the department, Ms
Hewitt, informed the committee that she had
been made aware of the cabinet decision through a minute of cabinet. She had
informed senior departmental officers of the directive at a meeting to prepare
for their appearance at the estimates hearing. A short time later, Ms
Hewitt corrected her evidence by recalling
that a brief written instruction to staff was also issued.
The chair then read out advice from the Clerk of
the Senate prepared for the committee on 9
If a minister wishes to raise a claim of public interest
immunity and decline to answer questions on the basis that the matters are
before a commission of inquiry, that is the responsibility of the minister, not
a matter for the chair to rule on that. If the minister persists with such a
claim, the committee can only report the matter to the Senate.
The chair interrupted proceedings to challenge
the appearance of several television camera men in the room, who had not sought
the committee's formal approval for their presence. They were requested to
leave until formal approval was sought and granted.
The department advised that it did not provide
any documents directly to the Cole commission
but documents were provided in response to a request from the Department of
Foreign Affairs and Trade (DFAT). The secretary was unwilling to make any
further comment about the nature of the documents submitted.
Management Services and Corporate Policy
The committee was interested in the compensation
claim lodged by Marnic Worldwide Proprietary Ltd relating to the importation of
marine worms for recreational fishing. The department confirmed that a claim
had been lodged with the Department of Finance and Administrative Services and
it was forwarded on to DAFF for assessment. The original timeframe for
assessment was 31 January 2006
but the minister has approved an extension until 28 February 2006, due to the complexity of the claim. The
applicant has not yet been advised of the extension.
Other matters raised by the committee included:
Departmental expenditure; the difference between
'appropriation reprofiling' and 'appropriation rephasing'; revenue projections;
capital expenditure for new accommodation; and exceptional circumstances
payments (Estimates Hansard, 14
February, pp. 8–10).
Food and Agriculture - Wheat Export Authority
The committee questioned the Wheat Export
Authority (WEA) at length about its knowledge of allegations relating to the Australian
Wheat Board (AWB) paying kickbacks in Iraq
and its role in monitoring AWB.
The committee began by referring to a question
it had asked at the last estimates about whether WEA had any knowledge of the
Jordanian trucking company. At the
time, WEA had informed the committee that it had none. In the week before this
hearing, the Chairman of WEA, Mr Besley,
had sent a letter informing the committee that his previous answer was:
factually incomplete. The WEA was made aware in mid 2004 from
material in its possession that AWB(I) was supplying wheat into Iraq
under an arrangement that included over land transport by a Jordanian trucking
Consistent with its function of reporting on the outcomes of the
export performance of the national pool and in response to public allegations
of AWB(I)/AWB Ltd paying "kick backs" in Iraq the WEA undertook to
address the issue in its 2004 performance monitoring activities.
The committee was interested to know how Mr
Besley had failed to recall an issue that
WEA had in fact been investigating in 2004. Mr
It is a matter of regret that I gave the answer I gave. The
question you could ask is whether I am forgetful or I was improperly briefed. I
do not want to speculate on either of those things...When it became clear to me,
as we were providing information to the Cole commission, that I ought to
revisit some of the documentation, I did so...I then finished up writing a letter
to the chairman and discussing it with the minister because, in fact, the
information that I did not have in my mind—you could
ask why I did not and the answer would be that I just did not have it in my
mind—was contained in a report we sent to the minister in about October 2004,
which did refer to the Jordanian trucking company...
The committee then raised a number of issues
with WEA, including those in the following list. A summary of WEA's answers is
reported in paragraphs 3.17 to 3.27:
Whether WEA had reported to the minister on its
investigation into the rumours of kickbacks and included references to the
Jordanian trucking company (Estimates
Hansard, 14 February, pp. 12–13).
Whether WEA's investigation went beyond asking
AWB if they were paying kickbacks (pp. 12–13).
WEA's interpretation of AWB's corporate
governance charter (pp. 13–14).
Whether its investigation had been reported in
WEA's growers report to the shareholders and farming community (p. 14).
The reason why WEA did not use its compulsory
powers to carry out an investigation (p. 14).
WEA's role in monitoring AWB (pp. 13, 15, 32, 34–35,
41–42, 48–49 and 53).
Legal interpretation of WEA's role (pp. 48 and
The scope of WEA's investigation and whether it
carried out a full audit of AWB's books or was confined to checking a sample of
17 contracts (p. 15).
The purpose of WEA's investigation (pp. 47–49)
Who made the decision to conduct the
investigation into AWB and when it was made (pp. 17 and 32).
Whether the minister's office was advised of
this decision (pp. 17–18).
How the request for information was communicated
to AWB (p. 19).
Whether AWB provided WEA with complete files on
the 17 contracts or just part of them (pp. 19–22).
Whether WEA saw information relating to
contracts only or a wider range of documents (pp. 23–24 and 32).
How and when WEA became aware that AWB had
engaged a Jordanian trucking company (pp. 24–29).
Whether WEA looked into the cost of transport
(pp. 33 and 43–44).
Steps taken by WEA to assess the implications of
the payment of kickbacks on the pool both in financial and legal terms (pp. 14,
32, 45 and 47).
Whether WEA had seen the Volcker inquiry report
and took any action as a result (pp. 29–31, 34 and 47).
Whether WEA had been provided with a copy of the
2003 report prepared by the US Defense Contract Audit Agency on its
investigation of contracts awarded under the oil for food program, as stated by
Mr Vaile in parliament (pp. 16–17, 18 and 43).
The terms of reference for the 2004 Williams
review which examined AWB(I)'s management arrangements relating to the single
desk (pp. 37–40).
The reason why an out-of-performance bonus payment
was made to AWB in 2002–03 (pp. 15–16 and 50).
The role of the export consent arrangements
working group (pp. 51–52).
Material provided by WEA to the Cole inquiry;
material provided to other government agencies (pp. 31, 33–34 and 45–46).
WEA's value for money to the wheat growers (pp. 54–55).
All of the committee's questions were answered
by WEA or taken on notice, with only one attempt to restrict the scope of
questioning. Senator O'Brien
asked if WEA had investigated the payment of kickbacks in the context of its
effect on AWB(I)'s tax liability. The chair stated that the question impinged
on the Cole inquiry. Senator O'Brien
pursued his question and Mr Besley
replied that WEA had not investigated the issue.
In relation to WEA's investigation, the
committee was advised that:
WEA is required to report to the minister each
year on the results of its monitoring of AWB's management of the pool. The last
performance review report, sent to the minister in October 2004, also reported
on WEA's investigation into the media allegations and referred to the use of a Jordanian
WEA first became aware of allegations of
kickbacks through the media and it decided to investigate. This decision was
taken at a joint board meeting between WEA and AWB in February 2004.
A senior WEA officer examined 17 contracts at AWB
International's offices in August 2004. Later in the hearing, WEA clarified
this further by saying that the essential elements of the contracts were
presented in a folder to the WEA officer to check. It was not known whether the
complete contracts were seen as the officer has since retired. The WEA officer
made a file note recording what was viewed in the documents. WEA undertook to
provide this information on notice.
Mr Besley later clarified that the WEA officer
did not only see information relating to 17 contracts. The annual report to the
minister also mentioned that WEA had examined various records, certification of
export details and authorisation letters from the United Nations. The WEA
officer also met face-to-face with two officers from AWB.
In its examination of the contracts, WEA
focussed on checking that the FOB (free on board) costs, which are charged to
the pool and affect the pool price, were correct and consistent with previous
During the investigation, AWB denied any
wrongdoing and stated that if the price of wheat seemed higher than the
benchmark, this was because it included the high cost of transportation up
country. WEA did not inquire into the cost of transport. WEA also looked at AWB's
corporate governance charter which included a requirement that any agency
payments were required to be approved and reported. WEA checked AWB's record of
agency payments and there were none registered for Iraq. On the basis of these
investigations, WEA was satisfied that it was not impacting on the price of the
When WEA asked AWB if it was paying kickbacks
and AWB denied any wrongdoing, WEA did not pursue the issue further as it
believed it had developed a good working relationship of trust with AWB.
WEA's annual report to the minister is a
confidential report. Information about the investigation was not included in
WEA's growers report to the shareholders and farming community as it was
regarded by AWB as part of its commercial negotiations which it preferred not
to have publicly disclosed. WEA has an arrangement with AWB not to disclose
commercial-in-confidence information or information that WEA has acquired
through the use of its compulsory powers.
WEA did not feel that it was necessary to use
its compulsory powers to carry out the investigation as AWB had been
cooperative with its inquiries.
WEA first became aware of the Jordanian trucking
company when it was mentioned in a short briefing document from AWB in May 2004
which outlined their approach to doing business in Iraq.
WEA also advised the committee that:
It did nothing specific as a result of the publication
of the Volcker report.
The CEO, Mr Taylor, was responsible for
overseeing the collation of material for the Cole inquiry. He checked for every
reference that the WEA had, in any record, to AWB(I) wheat sales to Iraq. It
was a very broad request covering a vast range of material, including hard
copies, electronic copies, copies of data files
and briefing material from AWB.
The committee questioned WEA extensively about
its role and powers under the Wheat Marketing Act. WEA explained that it has no
power to investigate what is done with the wheat once it is shipped from Australia. In relation to WEA's role, Mr
Let me clarify our role. Our role is to monitor—monitor, not
regulate—the performance of the AWB as the manager of the pool in the interests
of growers. It is not our role to get into their commercial operations or the
way they run their business or, indeed, how they operate as a board. That is a
matter for them, their directors, ASIC, ASX and all of that. That is not where
our role lies at all.
In response to a question from the committee
about the action taken by WEA to inquire into the trucking contract, Mr
Can I just clarify that we are not a policing organisation. I do
not hold with kickbacks or anything like that personally and I do not think any
of us do, but our role is to monitor the performance of AWB(I) as it manages
the grain pool. Once wheat leaves this country, charges of freight, insurance
and so on are costs to the buyer. They do not impact on the pool, so we had no
reason to go there.
went on to explain that WEA's primary purpose in carrying out the investigation
was to make sure there was nothing that was impacting on the grain pool:
One thing you could say is: if they were paying bribes, was that
a disadvantage to the growers, with the pool paying them? As it turned out,
even if they were paying bribes—and that is for Cole to decide—that money came
out of an escrow account and had no effect whatever on the pool costs.
WEA did not consider it was responsible for investigating
corruption within AWB(I). In
response to further questioning about its powers, Mr
Besley informed the committee that WEA does
not scrutinise AWB Ltd—its role is to monitor how AWB(I) manages the single
desk for the benefit of growers. WEA investigated AWB(I) in 2004:
For the purpose of finding out, if they were [paying kickbacks],
what impact if any it was having on the pool—not for the purpose of pursuing
that issue itself.
The committee expressed the view that WEA's monitoring
of AWB(I) was inadequate. Senator O'Brien
But, in this case, having decided to investigate kickbacks; to
not inquire—apparently—about the value of the trucking contracts, which were an
unusual arrangement; and to not inquire as to what sort of financial
transactions were taking place completely; how could you possibly have had a
proper insight into whether kickbacks were being paid? And do you seriously ask
us to believe that you were happy to accept, given the allegations that were
about, that a simple denial from AWB International was sufficient?
The committee challenged WEA's explanation for
not looking further into the kickback allegations that its only responsibility
is the impact of issues on the grain pool. Senator Siewert
asked whether the negative publicity surrounding the allegations and the Cole
inquiry was not ultimately impacting on the pool. Mr
Besley responded that it was 'an issue which
I cannot answer'.
The committee requested advice sought by WEA on a
legal interpretation of its role to be made available to the committee. WEA
agreed to provide it to the committee, subject to the minister's approval.
The committee was interested to know whether Mr
Besley and Mr
Taylor had discussed their forthcoming
evidence to the committee with the Minister for Agriculture, the minister's
office or the department. Mr Besley
responded that he had not, but the minister at the table, Senator
Abetz, clarified that Mr
Besley had been present in his office when
he discussed with DAFF officials the government directive not to answer
questions relating to the Cole inquiry (referred
to above in paragraph 3.4). Senator Abetz
added that he had indicated that the directive did not apply to Mr
Besley and Mr
Taylor, who as the Chairman and CEO of an
independent statutory authority could answer questions as they saw fit.
Food and Agriculture – other issues
The committee requested an update on the
implementation of the Sugar Industry Reform package. The department advised
The second tranche of the sustainability grant,
$73 million, was paid in September 2005. This followed advice from the industry
oversight group that the process of reform had advanced sufficiently to warrant
The industry oversight group is finalising its
strategic plan which will go to the minister soon.
One round of payments for regional community
project grants has been made and the second round is under consideration.
Out of the original allocation of $444 million,
$227 million has been spent as at 3 February 2006.
It is possible that some of the funding for
re-establishment grants may remain unspent as it is subject to demand from farmers.
There have been 642 applications for the
$100,000 exit grant to leave the sugar industry, with 368 approved and 175
rejected to date. This grant is available to the end of this financial year and
then it will drop to $50,000 for the next financial year.
In response to a request from the committee for
copies of the regional advisory group plans at the previous estimates hearing,
the department provided an abridged public version of the seven plans. The
committee asked why the detailed plans were not made available. The department
explained that the plans are owned by the regional advisory groups (which
include local community groups and businesses) who had concerns about releasing
sensitive commercial-in-confidence information.
The committee was critical of the plans as they
did not appear to meet the criteria originally specified by the industry
oversight group in terms of setting targets and other benchmarks that could be
used to measure progress. Senator O'Brien
Unfortunately, not all the concise plans do provide details of
benchmarks or targets. In some cases, even those which do provide targets are
so vague as to be next to useless.
The committee also heard evidence about:
Money provided to South Johnston mill (Estimates Hansard, 14 February,
Introduction of new country-of-origin labelling
laws for food (pp. 63–64).
Strategic planning for the production of biofuels
and bioenergy (pp. 64–65).
The committee was interested in Biosecurity Australia's
(BA's) draft policy for the importation of mangoes from Taiwan
which is being treated as an extension of the existing policy allowing mangoes
to be imported from the Philippines.
BA explained that where there is an existing policy that presents a similar
pest and disease risk to the commodity under assessment, it determines whether
to carry out a policy review rather than starting from scratch and doing a
complete import risk assessment. In this case, the issues relating to Taiwanese
mangoes are substantially the same as Filipino mangoes.
The proposed requirements are vapour heat
treatment (VHT) to kill fruit flies, orchard registration, pest control
programs for other insects, and general good hygiene in the management of the
orchard, as well as AQIS inspections on arrival. The committee expressed
concern that mangoes could be imported into Australia
from orchards in Taiwan
that have fruit flies, provided the fruit itself is treated with VHT.
The committee sought information on the impact
of restrictions by Taiwan
on the Australian fruit industry. This follows the government's recent
announcement that Taiwan
will now only accept fruit exports from Tasmania
and the Riverland of South Australia on the basis that these areas are fruit
fly free. BA advised that the ban has directly affected crops grown outside of
the two fruit fly free areas that are currently in season such as cherries and
stone fruit. However, other crops may be affected as they come into season. In
the short term, Tasmanian fruit exports have also been affected as they are
still awaiting administrative approval from Taiwan.
BA outlined the steps it has taken to put an
export protocol in place since Taiwan
listed Queensland fruit fly as a
prohibited pest in April 2005. The secretary indicated that it has been given a
very high priority by the department and the minister who are actively seeking
The committee asked whether there was a
connection between Taiwan's
refusal to accept fruit containing Queensland
fruit fly and BA's decision to fast-track an importation policy for Taiwanese
mangoes carrying fruit fly. BA responded that it stresses to other countries
who request market access that it does not do 'tit-for-tat' deals. Because of Australia's
quarantine regime, all decisions are made on a scientific basis. However, BA
also recognises that for Australia's market access requests of other countries
to be advanced, we need to be seen as making progress on their requests,
without committing to any particular result.
The committee raised concerns about BA's
contingency policy for the importation of Specific Pathogen Free (SPF) chicken
eggs. BA explained that these eggs are used in vaccine production and to
produce sentinel chickens for quarantine purposes. Australia
currently has one SPF egg producer who supplies all of the eggs for Australia.
After one of their two flocks broke down with a disease, there was great
concern that no SPF eggs would be available if the other flock broke down. In
the event of such a contingency, BA has developed a policy to source eggs from
overseas. The committee expressed the view that it might be imprudent to rely
on imported eggs in the event of a worldwide disease outbreak such as bird flu
and would like consideration given to creating another egg farm in a separate
location in Australia.
Other matters raised by the committee included:
Update on the draft uncooked chicken meat import
risk assessment (Estimates Hansard,
14 February, p. 65).
Timetable for completion of the Philippine's
banana import risk assessment (p. 65).
Import risk assessment for apples from New
Zealand (pp. 65–66).
Permit for the export of Tasmanian devils to
Denmark for a christening present (pp. 66–67).
Government review of options for dealing with
any future BSE cases (p. 70).
Background to compensation claim lodged by Marnic
Worldwide Proprietary Ltd (pp. 72–76 and 77–78. See also discussion at pp.
10–11 and 83–84).
Prawn import risk assessment and monitoring of
the disease risk presented by imported prawns (pp. 78–79).
The committee held a brief discussion with
officers from the International Division about:
Funding for Keniry technical cooperation
assistance committed as part of the negotiation of MOUs on live animal exports with
several countries in the Middle East (Estimates
Hansard, 14 February, pp. 79–80).
Department's role in the development of a free
trade agreement (FTA) with China (p. 80).
Product Integrity, Animal (including aquatic animal) and Plant Health
The committee requested information on lessons
learned from Exercise Eleusis which was staged in November 2005 to test Australia's
preparedness to deal with an outbreak of bird flu. The department advised that a draft
report on the exercise was completed at the end of January and is under
consideration by the ministerial council and its standing committee. Mr
The exercise was considered to be highly successful in both
capacity to deal with a zoonotic animal disease outbreak. It also served its
other main objective of being a very good training program for all the
officials and other participants in the exercise.
The department explained that experience gained
from a previous exercise which dealt with a simulated outbreak of
foot-and-mouth disease, Exercise Minotaur, influenced the factors that were focussed
on. Exercise Eleusis demonstrated:
The need for a clear national policy to be in
place to assess the risk to human health;
The need to consider personal protective
equipment and additional medical measures such as antiviral prophylaxis;
Good working relationships between the
agriculture and health agencies through information sharing and placing officers
from each department within the emergency management arrangements of the other;
The level of resources needed in the area of
The vast quantity of information generated;
The need to keep disease response strategies up
to date; and
The need for very clear national objectives in
terms of managing the emergency and making sure links have been established
within government, between departments, and more broadly between government,
industry and the wider community so that everyone has a clear understanding of
the disease strategy.
The committee also discussed:
Increase in receipts from the agricultural and
veterinary chemical levy due to the easing of the drought (Estimates Hansard, 14 February, p. 81).
Update on the national livestock identification
schemes for sheep, pigs and cattle (p. 81).
Australian Quarantine and Inspection Service (AQIS)
The committee asked about sample testing
conducted by AQIS on 97 items of imported horticulture. A press release by the minister
claimed the results demonstrated that imported horticultural products are safe,
however, two products were found to contain pesticide residues and 14 contained
E. coli. Ten of the 14 detections of E. coli came from one importer from Fiji.
The rest were from China.
Pesticides were found in garlic (fenvalerate) and sun-dried tomatoes (procymidone).
AQIS responded that the detections were referred
to the competent food safety authority in Australia,
Food Standards Australia New Zealand (FSANZ), for advice. The action taken depends
on the level of detection and whether that is considered to be harmful to human
health. The findings have not led to any changes in AQIS' border regime for testing
imported food but have resulted in further survey work of horticultural products,
targeting E. coli 157. AQIS will
provide the survey results to FSANZ for it to determine whether additional
testing is required as part of the normal testing regime.
AQIS' normal testing regime for imported
agricultural product varies depending on the commodity. Generally, pesticide
screens are applied to vegetables, with additional tests for processed
The committee questioned the need for this
promotion of imported horticulture and the purpose of the minister's press
release. AQIS explained that it was a response to concerns raised in the media
about imported food. AQIS wanted to be satisfied that its sampling arrangements
were adequate and provide reassurance to the Australian public.
The committee sought an update on the citrus
canker outbreak in the Emerald district in Queensland.
AQIS advised that it is still under investigation by its compliance and
investigations unit. Discussions are continuing with the Director of Public
Prosecutions (DPP) who will advise whether it can be taken further. The
committee will hold a follow-up hearing for the citrus canker inquiry on 1 March 2006.
Other matters discussed included:
Further information on the compensation claim
lodged by Marnic Worldwide Proprietary Ltd relating to the importation of
marine worms for recreational fishing (Estimates
Hansard, 14 February, pp. 83–84. See also discussion at pp. 10–11, 72–76
Protocol for the export of Australian tripe to
China (p. 86).
Australian Bureau of Agriculture and Resource Economics (ABARE)
The committee was again interested in the
discussions between ABARE and the National Water Commission in relation to
ongoing water research. ABARE advised that it has tried to develop a close
working relationship with the commission, providing regular advice to the
commission on the National Water Initiative through publications, seminars and
The committee asked for ABARE's outlook for
major rural commodities. There is expected to be a decline in prices for beef
due to lower exports to Japan
following the potential return of the US
to the North Asian market. Sugar prices are expected to rise quite strongly in
the next year as a result of much of the sugar production in Brazil
being directed to the ethanol industry instead of being exported. Cotton prices
are expected to ease due to high production out of India,
China and Pakistan.
Demand for lamb remains strong in the US
and Asia with some price increases expected.
There has been a fundamental shift in demand for
wool. The longer term trends in apparel and competition from other fibres have
contributed to the decline in demand. In addition, there does not seem to be a
strongly growing market for wool in China,
the largest potential market.
In relation to crops, wheat prices are expected
to increase because of lower production or yields coming from China,
Russia, the Ukraine
and the US. Production
of canola was very strong last year due to good seasonal conditions,
particularly in Canada.
Demand is very strong and is expected to increase as Canadian production falls
back after a return to normal growing conditions.
The committee was concerned about allegations raised
in a recent Four Corners program about
the undue influence of Australia's largest energy users on the government's
climate change policies, including allegations that ABARE is part of this so
called 'climate-change mafia'. ABARE responded that it was not aware of the
existence of a group known as the mafia, however, it was aware of the
Australian Industry Greenhouse Network (AIGN). ABARE does not have a formal
relationship with the AIGN but may consult with members of the AIGN as part of its
normal broad consultation process.
The committee was interested to know whether
ABARE receives any funding from members of the AIGN. ABARE was unfamiliar with
all of the member companies, so took the question on notice. A number of other
questions relating to ABARE's projections for greenhouse emissions were also
taken on notice.
The committee inquired about ABARE's sources for
funding for the modelling on climate change, emissions abatement and energy
use. ABARE advised that its funding is principally from the Department of
Industry, Tourism and Resources and DAFF.
The committee also discussed ABARE's forecasts
China's economy (Estimates Hansard, 14 February, p. 88).
US economy (p. 88).
Australian economy (pp. 88–89).
Demand in the minerals and energy sector
The committee followed-up on ABARE's work on the
cost effectiveness of the environmental water flows for the Murray-Darling.
ABARE provided the committee with a copy of its report.
Bureau of Rural Sciences (BRS)
The committee sought an up-date on the national
agricultural monitoring system (NAMS). Dr
Ritman explained that it is:
on target for a draft website by April
this year and a final by June-July this year...it is a jointly funded exercise
between the states and the Commonwealth to produce information that will assist
in drought exceptional circumstance assessments. It covers only the dryland and
broadacre areas in its first production in June-July. There will be
investigation as to the more intensive agricultural areas in irrigation, as a
is being developed to improve both the speed of assessment for exceptional
circumstances (EC) applications and the objectivity and consistency of the
information available to the National Rural Advisory Council in carrying out
The committee also raised the following matters:
National social data study (Estimates Hansard, 14 February, p. 93).
Water 2010 project (p. 95).
Rural Policy and Innovation
The committee questioned why expenditure for
Farm Help has been revised down from $42.5 million to $15 million. The
department explained that there has been a reduction in demand which is largely
drought related. Many farmers have applied for income support under drought
exceptional circumstances assistance instead of Farm Help and the availability
of other assistance such as the sugar reform package has also affected demand. At the same time, additional funding
has been provided to meet increased demand for the Agriculture–Advancing
Australia (AAA) Rural Financial Counselling Service.
The committee also discussed:
Requirement for the minister to table a
statement that he is satisfied that Dairy Australia is fully compliant with the
terms of its statutory funding agreement (Estimates
Hansard, 14 February, p. 96).
Update on areas in receipt of exceptional
circumstances assistance (p. 97).
Fisheries and Forestry
The committee was particularly interested in the
steps being taken to deal with illegal fishing in north western Australian
waters. The committee noted it has been well established that existing Navy and
Customs patrol vessels intercept a minute fraction of illegal fishing vessels plundering
the Australian fishing zone. The
committee focussed their questioning on deterrence of illegal foreign fishing
vessels and crews who have been intercepted.
The committee sought information about:
Penalties for illegal fishing;
Whether penalties apply to crew, skipper and/or
Ability to pay fines;
Steps to prevent crews reoffending;
Purpose of the automatic forfeiture provisions
of section 106A of the Fisheries Management Act 1991;
Difference between automatic forfeiture and
apprehension and the numbers of each over the past year;
The reason why every illegal foreign fishing
vessel is not apprehended and destroyed;
Destruction of vessels at sea;
Commonwealth government's prosecution policy
relating to illegal foreign fishermen; and
Difference between Western Australian state laws
and federal laws in relation to apprehending and charging illegal fishermen.
The department advised that penalties are
determined by the courts and range up to a maximum of $625,000. However,
penalties for Indonesian fishermen are usually significantly less. Between
January and December 2005, 384 people were charged with penalties ranging from
good behaviour bonds of $750 to fines of up to $130,000. Of these, 182 were
crew and 202 were skippers. Usually the skipper is charged, but crew members
are also charged if they can be identified as recidivist offenders. In reality,
there is very little chance of large fines being paid. The deterrent for crew
members is a short period of detention and then they are sent back to Indonesia
with no money.
The committee expressed the view that this was
not much of a deterrent, with fishermen free to return to Australian waters within
a few days on another ship. The department agreed, with Mr
I think that is the operational reality for us. The other
approach that we are taking in conjunction with colleagues from DAFF and other
agencies is really what is going to be the longer term and more difficult, in
some respects, approach: which is education, communication and Indonesian
government support for trying to stop these people coming to Australia to fish
in the first place. That is a really longer term investment and approach.
The committee heard that vessels can be seized
under the Fisheries Management Act for 30 days, pending appeal. If there is no
appeal, they are automatically forfeited to the Commonwealth. In 2005, in
280 vessels were apprehended and a further 327 vessels were sent home after
forfeiting their gear and catch only. Forfeitures are often used when Customs
or the Navy are targeting a larger vessel and they encounter smaller vessels on
the way. An increasing trend over the last couple of years has been the
appearance of larger numbers of smaller Indonesian boats called bodhis which
only carry two or three crew.
The committee disagreed with the department's
view that it is having an effect because it is catching increasing numbers of
Indonesian fishing vessels. The committee expressed the view that greater
numbers are being apprehended because there are far more incursions. The
committee does not regard these measures as successful or sufficient to deter
illegal fishermen from reoffending.
In response, the department explained that judgments are being made on a daily
basis about the best use of available resources to make the greatest impact on
The minister agreed that the situation is
unacceptable and a more cooperative approach between state and Commonwealth
governments is required, along with an increase in resources and greater
deterrents in the way of penalties. The minister also raised the issues of
disease and security.
The committee was interested to hear about work
being carried out on a regional management approach to fisheries. The department's Mr
McLoughlin advised that he met with his
counterpart in Indonesia
for two days in October last year. They agreed on the principles and main
headings of a shared stock management plan between Australia
for the red snapper fisheries, which refers to half a dozen species of highly
valued commercial fish, including saddletails and emperors. It was also agreed
that the management plan would utilise Australia's
policy approach to sustainable fisheries rather than Indonesia's.
Fisheries officials in Indonesia
were keen to learn how fisheries are managed in Australia
and they saw the shared plan as an opportunity to have a greater impact with
their own fisheries management in regional areas. They will travel to Canberra
in April to do further work on the plan before
it is presented to respective ministers for consideration.
The committee requested an update on the
fisheries structural adjustment package.
The following issues in relation to the package were discussed:
Proposed expenditure for this financial year on
the business exit tender (to buy concessions from fishers) and business
planning assistance (to assist fishers to decide whether to stay in or exit the
fishery) (Estimates Hansard,
14 February, p. 112)
Tender process to allocate funds
Grants for fishers to seek professional
financial planning (p. 113)
Public consultation on proposed marine protected
areas (pp. 113–114).
Fishing community grants programs
Grants for skippers and crew who lose their jobs
Northern prawn fishery (pp. 110–111, 116 and
Fisheries officers indicated that the government
has laid down general principles for these programs and the department has been
working out the structural detail. It has been negotiating with each individual
fishery to find the best way to do this. Once the structure of the package has
been finalised, it will go to the minister for approval and the tender
documents will then be released.
The tender process to allocate funds for the
fishing concession buyout is an area that is still being finalised. There are a
number of complex elements to be taken into account including the different
fisheries concessions of each fishery and the development of marine protected
areas, which are the responsibility of state governments and other Commonwealth
stated that the objective of the program:
is to solve the problem of overfishing and also improve the
structure of the fishing industry and provide people who are currently
struggling with a dignified way of leaving the fishery.
The target fisheries are the southern and
eastern scalefish and shark fishery, the eastern tuna and billfish fishery, and
the Bass Strait central zone scallop fishery. The
species in those fisheries have been assessed as being overfished and their
allowable catch for next season and the future has been quite significantly
reduced. The other fishery that is a target for the package is the northern
prawn fishery, on the basis that it has been very close to being overfished in
The department is aiming to provide fishermen
with a clear idea of likely catch levels and management strategies that will be
applied in the future so they can make an informed decision about whether to
stay in the fishery or offer the business up as part of the tender and buy-out
The committee also sought information about:
Incursions by large vessels of Chinese,
Taiwanese, Korean and Thai origin (Estimates
Hansard, 14 February, pp. 101–102).
Size of the illegal fishing take in Australia's
northern fisheries (p. 107).
Increase in AFMA's budget by $1.8 million to
provide additional funding for border protection; establishment of Horn Island
facility; extra expense of vessel destruction; use of Willie Creek centre
Marine pests carried by illegal fishing vessels;
possible risks to shore based fisheries and the pearling industry
What happens to the illegal catch after it has
been confiscated (pp. 109–110).
Why the illegal catch is usually dumped at sea
or destroyed; why some is offered for tender for removal from Australia for
sale in export markets; treatment of apprehended shark fin (p. 110).
Restrictions on mud crabbing in north Queensland
Extent of closure in the fishing industry in the
Great Barrier Marine Park over the last 10 years (p. 119).
Department's role in determining the boundaries
for marine parks (p. 119).
Department's intention to no longer use state
based contracted Fisheries officers to carry out foreign compliance work
Agreement between Australia and Indonesia to
work on shared stocks; agreement between surveillance agencies to work together
Bilateral fisheries forum (pp. 121–122).
Consideration given to the effect on fisheries
in other countries by the reduction of the fishing capacity in Australia (pp. 121–122).
Joint investigation study into the illegal
fishing trade (p. 122).
Darwin detention facility (p. 122).
Eden Regional Adjustment package for the
forestry industry; Matilda's Bakery; Boydtown Pty Ltd (pp. 122–124).
Natural Resource Management
The committee had a brief discussion with
officers from Natural Resource Management about:
Department's work on water rights issues in
Queensland (Estimates Hansard, 14
February, pp. 125–126).
Budget for the Natural Resources Management
Account; funding for the National Landcare Program (p. 127).
Budget for the National Action Plan for Salinity
and Water Quality (p. 127).
Budget for Tasmanian water infrastructure;
Meander Dam project (p. 127).
Senator the Hon. Bill Heffernan
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