Interview with Andy Park, ABC RN Drive


SUBJECTS: Tariff reform on agricultural products; environmental approvals; Australia’s cattle numbers

ANDY PARK, HOST: Well sticking with the consumer theme - toothbrushes to menstrual products, from fridges to toasters. These are just a number of everyday products expected to soon become cheaper. The Federal Government has announced it's going to ditch the 5 percent import tariff for nearly 500 products that come into Australia, saying it will cut costs, red tape and make it easier to do business. That list of 500 also includes a range of agricultural products like mushrooms, maple syrup and tyres for tractors and farming vehicles. 

Murray Watt is the Minister for Agriculture, Fisheries, Forestry and Emergency Management. Minister, welcome back to Drive.


ANDY PARK: These tariffs have been labelled "nuisance” tariffs, so why do we have them in the first place? Why is the Government now getting rid of them?

MURRAY WATT: Yeah, look, I guess they're really a relic of history now, Andy. Obviously, over the last few decades, there's been major efforts by Australian governments to eliminate a large number of tariffs as part of the drive to make the Australian economy more efficient. But nevertheless, there are these small tariffs that remain in place for hundreds of items, really for no good purpose. They're not protecting Australian jobs, they're not raising the Australian Government lots of money. All they really do is tie business up in red tape and act as an impediment to our trade and productivity. So that's why Jim has made the announcement today that we will abolish nearly 500 of these small “nuisance” tariffs. And really, it's another step in our Government's efforts to make the Australian economy more productive.

ANDY PARK: I'm curious what this might mean for the agriculture sector, of course, it falls into your portfolio - because businesses apparently have been spending $30 million in compliance costs each year, and that's a government estimate. So, what is the impact for primary producers here?

MURRAY WATT: Yeah, that's right, Andy. We estimate that all up these tariffs that we're going to be abolishing cost business about $30 million a year. So this will provide a cost saving to business in abolishing these tariffs and we would hope to see that reflected in some reductions of prices on items at the grocery store as well.

ANDY PARK: Hope. Hope’s an interesting word, do you think-

MURRAY WATT: Well obviously that would be the expectation that these cost savings would be passed on. And I noticed in Jim's speech, we don't want to overstate exactly how much this is going to save people, but every little thing helps. We've obviously taken a range of actions to provide cost of living relief in a number of ways. We've got the tax cuts coming on the 1st July, but everything we can do to reduce the price of goods and services in the Australian economy, that's a good thing. 

So, to take agriculture as an example, as you say, there's a small number of food-related items, some forms of imported mushrooms, maple syrup, which I can tell you is a pretty big staple in my household! Some types of vegetable and oils, frozen seaweeds, all sorts of these sorts of imported products that really aren't facing competitive pressures in the Australian economy. But also there's some good news for farmers in this as well. It's things like agricultural tyres for tractors and other agricultural machinery. There are these small tariffs that remain on place on those kind of items that we'll be abolishing as well. And again, we would expect to see those savings passed on to farmers and consumers more generally.

ANDY PARK: If you don't see those price decreases passed on to the consumer, would the Government take action?

MURRAY WATT: Well we obviously have a range of steps now underway to really try to take on the supermarkets and make sure that they are passing reductions on to Australian consumers. I've been very vocal about this since probably September last year or even earlier, that there was a growing disparity between the amount that farmers were receiving for their produce and what consumers were having to pay at the supermarkets. And that's some of what led Jim and the Prime Minister to make the announcement earlier this year that we were reviewing the Food and Grocery Codes, setting up ACCC inquiry. So sure, you know, when it comes to these items as well, we want to make sure that supermarkets and retailers are doing the right thing, both by farmers and by families.

ANDY PARK: I want to move on to talk about the comments today by the Treasurer who's promised faster decisions on approvals for resources projects. Tell me, has this idea come from the industry or from government?

MURRAY WATT: I would say a bit of both, and I'd also actually include environmental stakeholders in this as well. Certainly, when we were in Opposition, we received a lot of feedback from industry and environmental stakeholders that the current levels of and type of environmental regulation we saw around projects just wasn't working for anyone. 

You may have seen at the time that the former Government commissioned a review by Graeme Samuel, the former ACCC chair, into environmental regulation, which also found that it was costing business enormous amounts of money, but equally not doing a good job of protecting the environment. So, that's why Tanya Plibersek has commissioned that work that she's got underway at the moment to try to streamline our environmental approvals. What we're looking for here, in the end, is faster yes' and faster no's for projects. The amount of time that currently it takes to get decisions one way or another for projects is unacceptable. And as I say, it's not working either for the environment or for business. So that's what we want to try to change.

ANDY PARK: Speaking of faster yes', will this help to convince the Opposition to support the Federal Government's planned overhaul of the Petroleum Resource Rent Tax, the PRRT? Will this go some way to encourage them to support it?

MURRAY WATT: We certainly think it should, and I noticed that there have been some of the large gas companies again today call on the Opposition to pass the legislation that we have before the Parliament. We're very clear that Australians do want to see a fair share of our resources in the form of offshore gas be paid by gas companies to the Australian people. They are our assets, those gas resources. And the legislation that we've put to the Parliament does attempt to ensure that the Australian people receive a fairer share of those resources from the gas companies. 

But at the same time, we want to provide investment certainty to these companies, which is lacking at the moment. So, unfortunately, the fact that we can't get a clear answer from the Opposition about whether they'll support this legislation or not is depriving taxpayers of what they owed, but it's also depriving the gas industry of the certainty they need to make those investments.

ANDY PARK: For their part, Shadow Treasurer Angus Taylor says he won't be rushed, and he wants to wait for the Senate committee report on April 18. I mean, this throws a bit of a spanner in your works for reform in this sector, don't you think?

MURRAY WATT: Well it is disappointing that yet again we see the Opposition come up with reasons to oppose things or slow down things that the Government is doing-

ANDY PARK: Does it mean you'll have to negotiate with the Greens instead?

MURRAY WATT: Our preference certainly would be to come to an arrangement with the Opposition. I think that it would be best to be done in a bipartisan way by the parties of government to put in place that stable investment regime for gas companies. But also, as I say, to make sure that the Australian taxpayer gets our fair share of these resources.

I'm confident that in the end that the Opposition will come to their senses, especially when you can see so many business groups asking for this legislation to be passed. And the point Jim Chalmers made in his speech today was that the sorts of things that the Opposition is looking for in terms of guarantees from government, we've already provided. So that's why it's hard to see this as anything other than a cynical political gesture from the Opposition.

ANDY PARK: Just while I've got you, Minister, I'm talking with a Queenstown researcher who says that Australia has underestimated how much cattle it has by about 10 million, which is a fairly significant figure, which would have implications on how we track our greenhouse gas emissions. Can you be sure Australia does have the right numbers there? Is this something that you want to look into a bit more closely?

MURRAY WATT: Yeah, I mean, obviously, as the Agriculture Minister, you want to be dealing with the facts. And having a certain number, or a very close to certain number of the number of cattle we have in Australia is a crucial factor in designing our emissions policies, but also our trade policies and the work that we can do for the agriculture sector generally. So, I think it's not surprising that in a country as large as Australia with such a large beef population, it's a little hard to come up with a precise estimate. But the more accurate we can be with these things, the better. And there's good news for the agriculture sector at the moment; we saw last week ABARES released their expectations that we're actually going to see a rebound in agricultural production. We've got exports growing; over the weekend Meat and Livestock Australia announced that we were heading for even bigger increases than expected in exports of our red meat. These are crucial industries for our country and that's why we support them.

ANDY PARK: Well, we'll have to leave it there. Murray Watt is the Minister for Agriculture, Fisheries, Forestry and Emergency Management. Appreciate your time. Good afternoon, Minister.