Parliamentary Committees

ECONOMIC AND FINANCE COMMITTEE: CONSUMER PROTECTION FOR FARMERS

Mr PICCOLO (Light) (11:03): I move:

That the 70^th report of the committee, entitled Consumer Protection for Farmers: Reaping a Fair Harvest, be noted.

I will make a few comments on the report and how the report arose, and indicate where the matter goes from here, the report having been tabled and considered by the relevant ministers. The matter came before this house on 10 September when I raised farmers' concerns in my electorate and I also acknowledge the concerns raised by the member for Hammond. I acknowledge that the member for Hammond has supported this inquiry and given great support to farmers in his electorate, and we have worked together on some of the issues.

The issues brought to my attention concerned some farmers who were having difficulties with farm machinery. The issues can be summarised as follows: safety issues, in other words, the safety of the machinery itself; warranty issues, in other words, getting manufacturers to deal with warranty issues to repair machinery which had broken down or was faulty in some way; and also the issue of the farmer dealing with a manufacturer, or big business or multinational companies, and their ability to get them to do the right thing.

The other issue that is very important is looking at farmers as a small business and their ability to influence decisions of, as I said, manufacturers, but also their own economic viability when things go wrong. I had discussions, as I mentioned, with some other members in this place, in particular the member for Hammond. I also had discussions with the South Australian Farmers Federation which is also looking into this issue of warranties and dispute resolution.

On 10 September I raised this matter in state parliament, and I gave a report on those discussions I had had with farmers and the problems they were having in getting machine manufacturers to undertake repairs to machinery that was under warranty. While the initial problem occurred when the warranty was in place, often those problems continued beyond the warranty period, and often the manufacturers were reluctant to take further work.

Two problems arose from this. First of all that the cost of repairs to machinery often outstripped the original cost of the equipment itself. I am aware of one case—and I think this is in the electorate of Hammond—where one farmer spent more money on legal fees and battling for repairs than the piece of machinery, which I think was a tractor, originally cost. There are some issues about why you would do that, but I suppose the farmer thinks at some point the matter will be resolved so he keeps pouring in money. That matter has been resolved; I understand that it has been settled, but whether it is satisfactory is a different matter. However, certainly there is an issue out there.

The other issue, apart from the cost to farmers—and in the case of my constituent the cost to him has been estimated at about $2 million, and that matter has not been resolved, but I understand that, with the intervention of the South Australian Farmers Federation, the matter is being mediated at the moment and hopefully that will come to a satisfactory conclusion.

The other issue about machinery is the down time, when machinery is not in production. Because of the expense, often farmers buy machinery not only to do their own farms but also to contract work out. So when the machinery is not working in the farming industry, because it is of a seasonal nature one week or two weeks' down time can actually mean half a season of work gone. So not only do they lose their own crop, but secondly they lose the additional income from the contract work. So there is a huge cost. I am aware that in some provinces of Canada they have actually changed the laws to reflect that, that farm machine warranties of certain manufacturers have to retain certain products or items to repair equipment quickly, and if not there are penalties attached.

In that speech to parliament on 10 September, I did indicate to the parliament that I thought this matter warranted an inquiry, because the feedback I was getting, certainly from my electorate, and some of the members, was that it was not an isolated case but quite widespread. So, being a member of the Economic and Finance Committee, I decided to raise this matter with the committee and ask for an inquiry. To my shock and horror—I could not believe it—the Liberal Party members of the committee opposed the inquiry. All three of them absolutely opposed it. Mind you, they did me a favour in the long term—I do appreciate the members' support for me.

However, they opposed it, and these are the grounds they gave to oppose this inquiry to look at these issues: it was trivial; not a matter for our committee to spend its time on; and not really an issue, just something I had manufactured. These are the people who say they represent rural and regional Australia. These are the people who stand up day in, day out on the other side and talk about how we on this side ignore rural and regional Australia.

So they had an opportunity to actually support an inquiry to look at these issues and all three of them—what did they do—opposed it. They said no to the farmers, no to rural and regional Australia. It was an embarrassment to the other members—and I do know there are a few members on the other side who were embarrassed by their colleagues. So, they took their liberalism to the extreme, where they just did what they liked, ignoring the needs of their electorate. Like I said, they did do me a favour though, because it was interesting to note the reaction by the farming community and other industry bodies, who were quite amazed, disappointed and actually somewhat outraged by the Liberal Party's actions.

One of the reasons they gave was that this committee should not actually deal with it, it is not important enough. Clause (4) of the committee's functions states:

...any matter concerned with the regulation of business or any other economic or financial activity or whether such regulation should be retained or modified in the areas.

I would have thought that this is a clear reference point for such an inquiry; but, again, the Liberal Party members of that committee, to a T, opposed it. Like I said, there are a couple on that side who are embarrassed by their colleagues' behaviour.

What did the committee look at? The committee's references are summarised as follows. They were to look at the efficacy of the current warranty laws; what sort of product protection there is; procedures to deal with grievances; and occupational health, welfare and safety issues. The committee took evidence from a number of farmers in written and oral form. They took evidence from the South Australia Farmers Federation. I again acknowledge that the federation has been very active, has worked with the committee, has worked very hard to resolve this matter, and has been very active in establishing a process to resolve disputes. I commend the federation for its work. We also heard from SafeWork SA, Consumer Affairs and dealer organisations.

The reality in rural and regional Australia is that, often, the local dealer is the meat in the sandwich. On the one hand, they try to do the right thing by their farmer client and, at times, they get pushed to the other corner by a manufacturer or an importer. I do acknowledge that, in most cases, if not all cases, the dealers try to do the right thing, but unfortunately they cannot go against the manufacturer's wishes; although, at times, they have done warranty work out of their own pocket.

What did the evidence indicate? The evidence indicated overwhelmingly that there was a problem in this area and that some intervention was required. Despite what we were told at the committee, when the Liberal Party opposed it, the evidence was overwhelming that something had to be done. It was not only in this state, but the number of inquiries that I received from New South Wales, Victoria and Western Australia were also quite strong; so, it was a problem across the nation.

What was the evidence, and what are the problems? The problem is this: essentially, farmers at law are in the main small businesses, because they are generally all incorporated, and they are not covered by the normal Consumer Transactions Act. So, a farmer who buys a piece of machinery, which could be worth half a million dollars or a million dollars, has less protection as a consumer of a product than a person who buys a $500 refrigerator. In fact, the Farmers Federation president, who gave evidence to the committee, indicated that that is very much the case.

Unfortunately, in this state and also in this country uniform consumer laws at the national level, as I understand it, do not include protection for businesses. So, business to business transactions are not part of consumer law, but I think they should be and, certainly, it is the view of the committee that that should be looked into.

Secondly, because it is not part of the act, they have to take action themselves under the Trade Practices Act, generally speaking, which means going to court, and that is where we have a problem. The power relationship and the financial positions between a farmer and the manufacturer has an imbalance of power and an imbalance in terms of resources. The committee heard about cases where the manufacturer would just run up a bill and fight the case in court until the farmer gave up. That, to some extent, would probably be a similar case to what happened in the member for Hammond seat, where the farmer, in the end, cut his losses and settled.

What do we do to make sure that farmers get a fair go? The assumption is that, if you are a small business person, you can look after yourself and that you have an equal or a fair level playing field. That is not the case at all, and the history of litigation in this area would strongly indicate that. As I mentioned, the new national consumer laws unfortunately do bypass small business and also farmers.

What were the committee's recommendations? Basically, the committee recommended that there should be an independent mediation scheme that could provide alternative dispute resolution services for the agricultural sector. The committee went on to say that it should be voluntary mediation but that it should have some statutory support to enforce those decisions if they are made. I know that the South Australian Farmers Federation has established such a scheme, and I wish it well. One would hope that the voluntary scheme would work but, in the event of it not working, I think this matter needs to be revisited by this place to see what laws are required.

The other recommendations talked about perhaps looking at extending current state-based consumer protection legislation to include farming machinery. I think that was one of the recommendations supported by my colleague, now the Attorney, who was on that committee. His advice was accepted by the committee, and that recommendation went forward. I am not sure if we are progressing in that direction, but it is certainly something we need to keep a watch on.

One of the other recommendations the committee made, which I thought was important, was that we need to look at some sort of national code of practice which, if you like, helps to develop a framework to deal with a whole range of disputes in the farming sector. That would be something under the Trade Practices Act—a bit like the other codes of practice under the Native Vegetation Act which have legislative backing but which, to some extent, give the industry itself some footing to try to resolve its own problems—that would look at what are acceptable behaviours in that industry. I would certainly support a national code of practice being developed.

The other important issues are around occupational health, safety and welfare. The evidence heard by the committee indicated quite strongly that this is an area that needs some work. One of the problems is that, because of the way the law operates, farmers are often perhaps a bit reluctant to report faulty equipment, etc.; if they do they may get the equivalent of their equipment being defected, which means it is non-operational. They could lose a lot, particularly in the seasonal period. So we need to look at a way of encouraging and supporting farmers, and giving them an incentive to report product which is not appropriate but without penalising them in some way. One can understand that they would—quite rightly—be reluctant to report something if it meant that their machine would be defected for a whole season and they lost their sole source of income.

This matter, which has been reported to parliament today, certainly has not run its course. There are still outstanding issues, and I can indicate that I and members on this side—and I note that the member for Frome has indicated that he supports the recommendation and is also prepared to work in this area—need to pursue these matters to make sure that we give farmers, as the report says, a fair harvest.

In my closing moments I would like to acknowledge the support and contribution of the South Australian Farmers Federation and the National Farmers Federation. I would also like to acknowledge the support of my local federal member Nick Champion MHR who has—excuse the pun—championed this issue in the national parliament. He has raised this in the federal parliament and I understand that he has also met with farmers, certainly in my electorate, and lobbied national ministers. I also understand that he has arranged a number of meetings with farmers at the national level, and that he will be knocking on the doors of relevant ministers to make sure that the appropriate reforms take place at the federal level. It is a bit like other areas of law, when you do business across the states national laws are needed to support that. With those comments, I conclude my remarks.

Mr VENNING (Schubert) (11:18): I acknowledge the member for Light, who just sat down. I will not name the family involved, but this family first came to me in relation to this problem. Being a farmer myself I will declare my interest, because I do have a strong personal interest in this matter. I understand that my brother also gave evidence, so I declare that as well.

The Hon. R.B. Such: Do you still have the Steiger?

Mr VENNING: No; the Steiger was sold, sadly. My son sold it when I was not around, so it has gone, but it was a great project. The problem we originally had with this was that the Economic and Finance Committee had this matter before it to discuss the position. It is a statutory committee of the parliament, and that was the issue. The member for Light has already highlighted an issue that we had on this side of the house. This is a private consumer issue, so there is a question as to whether or not the parliament should have it.

I agree that, if you are outcome driven, it has been successful. You could say that there was no other avenue, so we did it this way. The member for Light was sitting on this committee, so he chose to do it this way. Irrespective of that—and I still say that it was an unusual thing to send it to this committee—if you are outcome driven, I say, 'Well, good on you.' I know the family, who I see regularly, in fact the man is a member of the Liedertafel choir, who I see every week.

Mr Pederick: Can he sing better than you?

Mr VENNING: He sings similar to me. He is aware of the difficulty we, on this side of the house, had about this. So, I know that family very well. The problem they had was not unknown, and particularly with one particular company.

Mr Piccolo interjecting:

Mr Pederick: You've had your go.

Mr VENNING: You know my position. I am not spinning anything. I am saying exactly what I feel. Where there is an issue of safety—and there was in this instance, with high hydraulic pressures—and when you are messing with these things they can kill people very quickly. A leaky hose at 3,000 psi can kill people, and this was the problem with this. It was obvious to me, and I have a bit of mechanical knowledge, that this was a mismatch of machinery: a machine made by one company and the front made by another, and there was an incompatibility of the two parts.

I will tell you what: it does not happen with John Deere. We are almost 100 per cent John Deere on our property and it never happens. I agree with the member for Light: dealing with multinational companies, such as John Deere and all these other companies—I will not name them—is difficult because these decisions are made in another country, usually Canada or the United States of America. The poor old local agent, the dealer, in this instance a dealer in Lyndoch, and I have no problem with him, they did everything possible that they could to fix this machine. I take my hat off to them. There is nothing negative about them at all. They certainly tried their best. It is just sad that the company did not come up with a better resolution.

As I said, I was quite confused as to why a consumer issue such as this would go to a statutory committee of the parliament. I agree with the member: if you do not send it there, where do you send it? That is a good question. I do not know. As I say, the outcome has been positive, I think, and it has certainly been highlighted. The member quoted clause 4. I read clause 4 and it is very open-ended. Nevertheless, the member interpreted it that way. Again, it has been outcome-driven.

Agricultural machinery is extremely expensive. We just bought a new boom sprayer a few weeks ago, and you are looking at a huge investment. You could buy two or three houses for the cost of one of these things, and they are very high tech. They are all hydraulically driven and if there is any problem with it the farmer cannot fix it with a piece of wire, like they used to, you have to get the technician out. The technician comes out, plugs his computer in and says, 'Yes, you've got a problem,' and the farmer can do nothing about it. So, the down time, as the member said, is critical.

Farming today is very time critical. If the machine stops operating, these machines are so expensive that the dealer does not usually carry a spare machine. In the old days, when we had small tractors, the dealer would often have two or three sitting on the lot, and he would lend you another tractor—in these instances, no way. There is usually only one in the district and that is the one that has gone down. So, that is a concern.

The warranty responsibilities are quite clearly laid out. When you look at the recommendations—and I will just read the two—of the committee, and the member did not mention them, recommendation one is:

The committee recommends to the Minister for Consumer Affairs and the Minister for Agriculture, Food and Fisheries that a mediation scheme to provide alternative dispute resolution services for the agricultural sector be created.

My question for the member is: has that happened? I certainly do not have a problem with that mediation scheme being set up. The second recommendation is a bit more vague:

The committee recommends to the Minister for Consumer Affairs and the Minister for Agriculture, Food and Fisheries that an alternative industry-based dispute resolution scheme be voluntary, that its decisions are binding on parties and, if necessary, it be given statutory backing to give it effect.

Is that conflicting with the first recommendation?

Mr Piccolo: It is complementary.

Mr VENNING: Well, I would have a good look at that. I ask the member: has anything happened since then? I know the Minister for Agriculture, as an expert, will be keen to get his fingers into this, and I can see no problem with that, particularly if it is done in conjunction with, say, the South Australian Farmers Federation (SAFF) and with a couple of independent people sitting on it. I think it would be a good move, because there are always going to be disputes like this.

Finally, I hope there will be some long-term outcomes. I think this took an unusual path. Whereas I did not agree with my colleagues who did not want to deal with it, I can understand why, because of this confusion of having a statutory committee of the parliament deal with what is a consumer issue. Again, it is outcome driven. If it is come up with a positive result, irrespective of whether it is right or wrong, I support that.

To the family involved with this, I say that I am sorry that you have been through this problem, because these people are hay contractors. This machine is a very critical type of machine—it is a windrower—and with it being down like it was, it certainly cost that family a lot of money. I am pleased that we have come up with a resolution, and I hope that we can move on. Again, all credit to the local dealer at Lyndoch. They did all they possibly could to assist, and I hope there is nothing in this that will cause them any hurt or pain whatsoever. So, the outcomes are there. Let us see what the long-term outcome is and, if it is, I am fully supportive.

Mr KENYON (Newland) (11:26): As the current chair of the committee—however, not being a member of the committee at the time—I just rise briefly to support the motion of the member for Light. I note that in his speech he talked about the consumer protection laws in Canada. Both the United States and Canada have particularly good consumer protection laws, and they are an example for Australia. I think we lag behind in consumer protection legislation and, over time, I would like to see our legislation strengthened.

I would certainly like to see a few more teeth. Individual customers and, in this case, small businesses—farmers particularly—are not in strong bargaining positions with international or even small to medium businesses in many cases. In particular, once you have handed over your cash you are in a very difficult position. Having some teeth in our consumer protection laws is something to aim for, and the United States and Canada provide a really interesting example of how we might go about doing that.

I am particularly interested in anti-trust laws. It is probably time Australia had some anti-trust laws—another federal issue, I understand, but it is something I would like to see. I think the American anti-trust laws have only been used twice, but they provide a very big stick for governments to use, allowing them to talk a lot more softly if they choose to do so. I would very much like to see anti-trust laws in Australia. I think we have issues with Woolworths, Coles and Telstra, and anti-trust laws would enable us to negotiate a little bit more evenly, or perhaps have a little bit more flexibility out of these companies when governments need to talk to them.

Over time, these companies have become more powerful and more dominant in the markets and, as a result, are working against consumers. That balance between consumers and retailers/sellers has been weighted unfairly in many ways. I do not know about anyone else in this chamber, but I will be very happy when the day comes when I do not have to deal with Telstra and I can move all of my telephonic accounts to other companies. That will be a great time, and I will not need to spend half an hour on the phone every time I need to communicate with my phone supplier.

I would also like to note the opposition of the Liberal Party to this very investigation, and even now the member for Schubert is out there trying to defend the position of the Liberal Party in opposing this inquiry.

Mr Venning interjecting:

Mr KENYON: You had better sit down so you can interject, Ivan. It is quite clear to me that, if nothing else, this is an ideal thing for a statutory committee of this parliament to be inquiring into because, while it is an individual example, it gives rise to an investigation into the laws of the state, and it will allow us to give due consideration, with a concrete example of how the laws of the state may be unfairly affecting consumers/small business in this state.

The fact that the Liberal Party was not standing up for small business does not necessarily surprise me, given its record over the last eight years. What does surprise me is the Liberal Party's refusal to stand up for its farming constituency, which you would think is the very heart of the Liberal Party in this state. However, the Liberals saw fit to just let it slide so that they did not have to deal with it. They did not see any reason for them to intercede on behalf of one of their core constituencies. However, it is not for me to tell them how to go about their business. I note only that the members for Mount Gambier and Frome are here as Independents and not as a members of the Liberal Party.

When decisions such as this are made by the Liberal Party, it does not surprise me that the members for Frome and Mount Gambier are Independent members. I am not going to lecture Liberal Party members; that is for them to do. All I point out is that the Liberal Party did not win seats that it needed to win, and I think this is part of the reason. Having said that, I think it was a very useful inquiry—an inquiry that needed to be made. The seasonal nature of farming and the importance of farming to our state's economy and the capital intensity of farming mean that we really need to be certain of where we are at.

We have to be very sure that we have the right meshing of consumer protection and small business laws in this state. This is a prime example of where they probably do not quite gel and where consumer protection laws might need to be pushed into the small business realm, which you would usually not expect to happen. Historically, you would say that farming has often not been treated as a business in this country but, in this particular case, we need to take a good look at how those two elements interact. With those few words, I am happy to support the motion of the member for Light.

The Hon. R.B. SUCH (Fisher) (11:32): I welcome this report. Whilst initially it might be dealing with one or two individual situations, I agree with the member for Newland that we need a complete overhaul of consumer protection laws. Most businesses do the right thing. I have had experience in my electorate, and I had an unusual instance in my early days as a member, which is going back a while. A lady who had a problem with her waterbed asked whether I could come down to help sort out the issue. I thought, 'Hello, hello!' I went down to see her, and she told me that she had bought this double waterbed, which had a divider in the middle. She said, 'I can't get next to my husband'—I said, 'Oh!'—and she said that she had been sleeping on the lounge.

Anyway, because the lady had had the bed for more than the statutory time within which you can return something, I rang Mr Waterbeds, which is not his real name. I said, 'I think we've got an issue here,' and he said that he would exchange it—and he threw in a doona cover. So, I am pretty sure I got that lady's vote. That is smart business practice—

An honourable member interjecting:

The Hon. R.B. SUCH: No, I don't think Mr Waterbeds was the husband! I had another one not long ago involving Adrian Brien Ford, where someone paid a deposit for a car and then realised they could not follow through with the sale because they had other financial issues. So, I contacted Adrian Brien Ford, and they agreed not to pursue the matter—that is smart business.

Another one more recently was where the dealer—an air conditioning company—was not quite so cooperative. The company basically said, 'Well, stuff the customer,' because the lady did not talk to them in a nice way. Well, I do not condone people talking in a rough way to business. However, most businesses are smart, most businesses do the right thing, but there will always be some that do not. I think that we need a review of consumer laws overall, not just for the protection of farmers.

Just to wrap up on this issue and this report and some of the issues which, obviously, were not covered in it and which it did not intend to cover, farmers as individuals are very vulnerable because they operate in a pretty tough market. They are vulnerable, obviously, to a whole lot of things—climatic conditions and so on. What we are seeing as an ongoing issue (and it has been addressed elsewhere and, hopefully, will be resolved in part through the COAG inquiry) is labelling, which is disadvantaging our farmers; fair prices, because farmers get screwed down, particularly by some of the larger commercial operations; and imports, which are not adequately checked in my view—only a small percentage are checked by AQIS, the quarantine service.

You only have to look at the price that dairy farmers get for milk and then you look at the price you pay for flavoured milk in a small container to realise that someone is getting milked, and it is not the dairy cow. A dairy farmer is lucky to get between 30¢ and 40¢ a litre for white milk at the gate, and then you buy a 600ml iced coffee and it costs you about $3, so there is a bit of a mark-up there. Farmers moved away from co-ops, which was one of the strong elements, I think, of farming in South Australia for many years—the various cooperatives.

I think that farmers might well revisit the concept of working together and supporting each other through cooperatives, because otherwise they get picked off one at a time. We know that they do not like tight associations. Farmers do not like to be told what to do. They tend to be independent sort of characters, but I think there is merit in having more cooperative type arrangements, whether it is in buying, purchasing power, protecting their consumer rights and so on. I think that farmers ought to be moving towards, as a suggestion from me, being in cooperatives.

I commend this report. I think that it is a small step, and it highlights the fact that, in South Australia you might be one citizen or a couple of citizens, but you can still have access to our parliamentary system to have a conduct of an inquiry; and I think that is one of the virtues of our democratic parliamentary system.

Mr GRIFFITHS (Goyder) (11:37): I wish to make only a brief contribution to this, not having been a member of the Economic and Finance Committee at the time of the investigation being carried out. I do not have a detailed knowledge of it and I have not had a chance to review the paper itself, but I do have some historical involvement in that I know that the time of the consideration of the establishment of the investigation was around the time of the Paskeville field days occurring in the northern part of my electorate.

I had a stand there and I had farmers and machinery dealers come to see me about the fact that they had heard that an inquiry was going to be undertaken. I do respect the fact that the member for Light pushed the idea of this committee investigation based on concerns that had been put to his office. He spoke to the farmers involved, he was concerned about the responses being received from some of the dealers and he decided to see whether there was an opportunity to investigate what was happening.

I am also thankful to the member for Light who provided to me a copy of the one submission which, I think, was received from within my electorate, a farmer in the Urania area I have had some contact with. They told me the story of their issue in relation to a very valuable piece of machinery, where there had been some frustration with the responses for the need to fix some minor problems with that. It is important that our farming community is supported, but it is also imported to recognise that the machinery dealers who operate in regional South Australia with which this report deals are people who, in many cases, have been there for many generations.

They are family businesses that have a strong commitment to the community. They do go out of their way. I know that dealers who operate in my electorate work very long hours in the peak times when a breakdown occurs and an immediate response is required to get a machine fixed and back operating, because, when a farmer is working, all they want to do is to make sure they continue to work. It is a difficult issue. I know there has been some criticism in regard to the opposition's response to this. I also read the report that was in The Stock Journal and wondered about it.

However, I do recognise the fact that, at the time of that comment being attributed to the opposition, there were also some proposals from the opposition concerning investigations into other matters before the Economic and Finance Committee which were also very justified. I think it demonstrates some of the frustration that lower house committees feel in that, yes, they are well chaired and a strong spirit of bipartisanship exists the majority of the time, but political influences occur when, say, we from this side feel that a real case needs to be investigated, but because it could be potentially damaging to the government, it is not supported by the majority of members; namely, members sitting on your right side, Mr Acting Speaker.

Politics come into it, too, but I can assure all members of the chamber and anyone reading the contributions on this matter that in no way is the Liberal Party not supportive of small business and the farming community. It wants to ensure that all have the opportunity to be successful and it is focused on anything that allows that to happen. Some rather scurrilous remarks have been made across the chamber this morning which I believe do not truly reflect our position. It is unfortunate that they were made. Whether it is now or in the future, members of the Economic and Finance Committee will be focused on undertaking some investigations that provide opportunities for South Australia's money—and that is what it should be focused on—to ensure that it is spent in an appropriate manner.

This is a difficult issue. I know that the machinery dealers to whom I have spoken are committed to ensuring that the product they sell, especially in a farming situation—and it is often worth hundreds of thousands of dollars—works as it is designed to do, and as soon as there is a problem, there is a very quick response to fix it and to get that machine operating. Yes, the committee's inquiry is understood, acknowledged and supported. I do not believe a minority report was submitted.

It is an important step forward and will give surety to all sides of the equation that, when a lot of money is spent on a piece of machinery, it will be operational. The farmer wants that and the machinery dealer wants that, because the best way for the machinery dealer to be assured of future sales is by ensuring that the quality of the machinery they sell is recognised by anyone in the market who is looking for a new machine, because word of mouth advertising sells better than anything. I appreciate the submission of the report to the chamber and look forward to some improvements in the future.

Mr PEDERICK (Hammond) (11:42): In speaking to this report on consumer protection for farmers, I indicate that the member for Light kept me informed of what was happening because, as he mentioned in his speech, he was aware of a constituent of mine who had a tractor and he could not get any happiness from the local dealer concerning a repair that needed to be done so that he could operate the machine. This machine was quite good mechanically, but there was a major issue with the air conditioning system. It is very sad that the dealer did not seem committed to fixing the problem. What I believe was probably more the case is that I do not think the company above the dealer gave the dealer the appropriate support to address the issue. I firmly believe that major machinery companies are quite happy to take cases like this to court.

As the member for Light indicated, a tactic of machinery companies is to hand it over to their legal wing and forget about the actual nuts and bolts of the machinery, and then leave them to handle it until the farmer runs out of cash, patience, or both. It is a real tragedy what happened with my constituent and the amount of money involved. I believe that it was the first time my constituent had bought a brand new tractor in his farming career, so you can imagine the disappointment that this has caused him. It has caused him years of stress and it is unjust. Essentially, the major manufacturing company handed this case over to their legal wing and left them to handle it. I think that is where much of the fault lies.

The other thing with which I agree with the member for Light is that it does need pursuing on a national scheme, and that is simply the nub of the matter. It is national legislation under the Trade Practices Act that should be addressing these issues, because there are far too many of them and we on this side do champion the cause of farmers. It should not get to this stage when you have machinery worth in the hundreds of thousands—harvesters these days can be optioned up close to a million dollars by the time you spec them up—there should be far better protection for the buyers of this machinery and also, at the end of the day, they should be manufactured better, or matched up with other machinery—as has been indicated today—if one part of a machine is manufactured in one place and one in the other.

The big frustration in farming—and I should note that I have a direct interest obviously, coming from a farming background, so I mention my interest in farming directly—is the availability of service and the availability of parts for machines. When machinery is so expensive it is fair and just that farmers think that these things should be available so that they can get on with life. So I do have real sympathy for the people who have been caught up in this. I believe it can be worked out with national legislation, and that would go some way toward helping the problem.

I am a bit confused (as is the member for Schubert) about two of the recommendations of the committee. Recommendation 1 states:

The Committee recommends to the Minister for Consumer Affairs and the Minister for Agriculture, Food and Fisheries that a mediation scheme to provide alternative dispute resolution services for the agricultural sector be created.

Recommendation 2 states:

The Committee recommends to the Minister for Consumer Affairs and the Minister for Agriculture, Food and Fisheries that an alternative industry-based dispute resolution scheme be voluntary, that its decisions are binding on parties and, if necessary, it be given statutory backing to give it effect.

I think to save confusion—I was not on the committee and I am no expert—perhaps combining those two recommendations would have been simpler for people reading the report and taking it in.

I note the windrowing machine that the member for Schubert and the member for Light referred to. I actually had a look at the machine, and the problem was that one part of the machine had high pressure hydraulics and one part had low-pressure, so it was never going to work. The company, as I said before, was quite happy to go down the legal route and just let it work out that way. A friend of mine also bought a similar machine but, sadly, he bought it second hand, so he falls into the 'buyer beware' category and would not have the same protection as someone buying a new machine. These things do need to be addressed.

In closing, I note the comment of the member for Newland, who alleged that we are not here for our farming constituents. I can tell you that we are here for our farming constituents, and if members on the other side (including the members for Light and Newland) are so concerned about the farming industry, they should go to their Treasurer and their so-called self-proclaimed expert on agricultural affairs, minister O'Brien, and ask him why he is pillaging PIRSA, cutting it to bits, and just destroying it. They are not going after the mining side of PIRSA. Don't get me wrong, I support mining full on, as does the member for Newland. I know he supports mining.

Members interjecting:

Mr PEDERICK: If these members want to come in here and make these allegations, well, let's see them stand up in here for the public servants today. I know that one person, after 33 years' faithful service to PIRSA, was told two or three weeks ago that it is over today. And there are others who have been working in the higher levels of research and development with SARDI. I am not going to mention names, but I believe their last day is today as well. These are people who have been at the leading edge of research and development in this state, and their jobs, as far as working for the department of agriculture is concerned, are finalised today. Certainly, in one case that I know of, a person has been told he will have to accept a transfer out from where he lives. He wants to stay where he lives. He has lived in that community for over three decades, and he wants to stay there.

This is the thanks that this government gives to these people, who are so vital in ensuring that the rural industries of this state are vibrant and keep going. We have this so-called self-proclaimed best agriculture spokesman in the world, minister O'Brien, who puts out a press release the other day saying he wants the food sector to be as good as defence and mining. Well, he is just cutting the guts out of it. If you have got absolutely nil investment and then less investment, where do you think it's going? It's going nowhere. They are hollow words. Let's not carry on about what our relationship is with farmers. We know what the Labor Party's relationship is. The biggest farm they are aware of is that bloody eighth of an acre in their backyard.

Ms CHAPMAN (Bragg) (11:51): I just wish to briefly speak to this report. I too am inspired by the member for Hammond to confirm the opposition's concern at the prospect of the death of PIRSA. What is so stunningly bizarre about the government's action is, firstly, when I came back into the parliament after the election and observed that the minister for primary industries is down at the end of the line, it just confirmed to me how little the government was concerned about primary industries in this state.

Notwithstanding that, of the top 10 income producers for this state—in fact the entire viability of this state—nine are primary industries. They are what keep our state alive. They are what provide us with the income for those of us who might be in urban living, provision of services, and the like. They are the actual income producers. Primarily, alcoholic beverages, and copper, uranium, wheat, barley, and fishing are in that top nine, and they are spread across the region outside of the greater metropolitan area of Adelaide.

The 10^th one in that category is the car manufacturing industry. Sad as it may appear, the car manufacturing industry for South Australia may not have a long-term future as an income producer that it has had in the past, and that will be a sad day, because manufacturing has played an important historical contribution to the economy of the state. But, as we have seen, the collapse of employment and opportunities that were there for what was originally Chrysler and then Mitsubishi, which is evident, and the closure of one of the shifts at the General Motors Holden plant, are all signs to us, coupled with the moving out of the state of the component industries that have been so well represented in this state over the last 30 to 40 years.

I am sure that people like Sir Thomas Playford, who is splendidly displayed in our chamber, if he were here today, would be deeply disappointed at what is the eminent slowing down of a major industry. However—

Mr PICCOLO: Point of order. I know that the Liberal Party is embarrassed by this whole inquiry matter, but it would be useful if the Liberal Party could talk about the inquiry itself. I know that the member for Bragg is trying to extend this to go over time, but it would be an injustice to the farmers, whom the inquiry is about—

The ACTING SPEAKER (Mr Kenyon): Order!

Mr PICCOLO: —that the speech go along in this—

The ACTING SPEAKER: Order! Member for Light, I think I understand the point of order. Member for Bragg, you will need to keep to the report, and I will just point out that at 12 o'clock we will need to move along. Member for Bragg.

Ms CHAPMAN: However, when that 10^th industry, the manufacturing industry, bites the dust as a major income producer I have absolutely no doubt that the tenth will actually be a primary industry in this state. The whole ten are what keep our state going. They produce income, and they provide the very basis upon which those of us in the service industry depend—lawyers, doctors, accountants, etc.—to enable us to actually receive the funding, the people and the purpose for being here, to actually be able to function and live here. Our whole state was built on primary industry and farming. I can go back to the original charter in the House of Commons, if the member for Light is really interested in that.

However, I would like to say that we started this state with democratic standards, and with them an absolute commitment to mining and farming, whether at the pastoral level for stock or for harvesting in intensive or broadacre farming. Either way, these have been very important industries for the state right from the start. Indeed, some of the first laws in this chamber were in relation to customs and excise before we became part of a federation, issues regarding rules for the exploration and exporting of our mineral wealth and all the rules that we had in establishing, for example, pastoral boards to protect our environment in the very sensitive areas in the northern part of the state—bearing in mind, obviously, that a large part of the state is desert.

That includes the Riverland, of course, a beautiful part of the state—and that member is not immediately present. It is an area that is a river running through a desert but, with proper water management and irrigation, it has been opened up as a food basket for South Australia. All these things are very important for the financial stability and future of this state, and are the only opportunity for this state progressing. In the past I have been a strong advocate of re-amalgamating with the Northern Territory—we gave it up in 1910—which would, of course, give us more land for farming, pastoral and mining activities.

In fact, it would give us a massive increase in the male population. We have a disproportion between this state and the territory; we have a majority of females and they have a majority of males, so it would not be a bad idea if we got together. I am happy to recommit my passion for this proposal, given that we are here in the year 2010, 100 years since the passing of commonwealth legislation, to take that precious part of Australia away from South Australia. I can tell the house that I will be one who continues to bat for getting it back.

In the meantime, it is important that, to secure the farming community, we ensure that it is not overburdened with regulation and that it is protected so that, when farmers buy a product, it works. If it does not work, they must be properly protected against mischief at the manufacturing level or inadvertent neglect at the time of retailing or wholesaling. All this is important to ensure that we do not crush our farming community, as the demise of PIRSA clearly will.

My father, a former minister for agriculture in this state, would turn in his grave, given the pioneering work that was done by both Labor and Liberal governments in opening up the deserts, from Libya to Algiers to Saudi Arabia, to find that today we are effectively on the last day of an institution that has supported the most productive and essential income earning and economic base of this state. It is a very sad day; it is shameful. I feel a bit sorry for the minister as well; basically he is going to be useless. He is going to be redundant. He is going to be paid off. He will have to go back to Springfield and start growing strawberries or something. However, the reality is that he will be out of a job, and yet the economic engine of this state will be left without a support base.

The only remedy is, of course, for the farming community of this state (including pastoralists and graziers) together with mining, to pay separately for services, which every other industry of this state, one way or another, gets some support from, but not those who are critical to the viability of this state. We may as well close up and sell up.

Debate adjourned.