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House of Assembly - Fifty-Second Parliament, Second Session (52-2)
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CITRUS INDUSTRY (WINDING UP) AMENDMENT BILL

Second Reading

Second reading.

The Hon. P. CAICA (Colton—Minister for Sustainability, Environment and Conservation, Minister for Water and the River Murray, Minister for Aboriginal Affairs and Reconciliation) (12:02): I move:

That this bill be now read a second time.

Passage of this bill through the parliament is a significant milestone for South Australia's citrus industry, which generates about half of the state's horticultural export income—$66 million in 2010-11. The bill sets in motion a process to wind up the Citrus Industry Development Board and the Citrus Industry Fund. In due course, the act will be repealed. The immediate benefits to the citrus industry will be the removal of a regulatory burden that imposes compliance costs in the order of $3.3 million per annum on citrus growers, packers, processors and wholesalers.

The net savings for citrus growers, who currently contribute to the Citrus Industry Fund established under the act, and to the Citrus Growers Fund established under the Primary Industry Funding Schemes Act 1998, will be $2.85 per tonne of oranges they produce and $1.85 per tonne for all other citrus fruit they produce. The government expects these savings will be welcomed, particularly by those farming families who operate small to medium-sized citrus properties who have done it tough in recent years as a consequence of prolonged drought in the Murray-Darling Basin, the global financial crisis and an exchange rate for the Australian dollar that is challenging for exporters.

Deregulation of the citrus industry has been a long time coming, since the 1965 Citrus Industry Organisation Act established an orderly marketing scheme that endeavoured to ensure fair returns for growers. Possibly only the members for Croydon and Schubert were here when the Citrus Industry Act 1991 was passed to create a new citrus industry board—

An honourable member: The fathers of the house.

The Hon. P. CAICA: —yes, with a very long memory too—one with reduced but still onerous regulatory responsibilities. Those early reforms have had their detractors, resulting in conflict between various citrus industry bodies claiming to represent the industry's stakeholders. The current act was passed in 2005 but only after protracted consultation with the citrus industry, and the potential for ongoing conflict between the industry bodies was overtly recognised when it was being formulated.

Unfortunately, conflict did continue, leading calls for the government to intervene. Eventually in 2011 then minister for agriculture, the Hon. Michael O'Brien, commissioned a retired District Court judge, Mr Alan Moss, to review the industry structure. Mr Moss determined that none of the board's functions is not already done, or could not be done, by another body, and concluded that there is no good reason to retain either the CIDB or the act. That conclusion resulted in this bill.

Consultation on a draft of the bill resulted in the inclusion of a reserved power enabling the Minister for Agriculture, Food and Fisheries to require a citrus industry participant to provide periodic returns of information reasonably required for the purposes of the industry. This reserved power addresses concerns that immediate deregulation of the citrus industry may create an information vacuum if the national industry organisation, Citrus Australia Ltd, fails to deliver on its undertakings to gather and publish relevant industry information.

While the government is optimistic that the industry-owned and managed arrangement will deliver the goods and that this power will not need to be exercised, the government also accepted an amendment moved in another place by the Hon. John Dawkins that the principal act may not be repealed before 1 January 2014. This will allow a full citrus season to pass before the adequacy of the industry arrangements is assessed.

To conclude, I thank members of this house, particularly in the other place, for their contributions to the debate and, as we have discussed, their willingness to expedite its passage so that there can be a seamless transition to the arrangements provided for the bill immediately following the expiration of the appointments of the members of the current board on 14 September. We have had discussions about how we might progress this, and I thank the opposition for their commitment to do so.

Mr PEDERICK (Hammond) (12:07): I am the lead speaker for the opposition on this bill, the Citrus Industry (Winding Up) Amendment Bill 2012. The Citrus Industry (Winding Up) Amendment Bill 2012 will wind up the current South Australian Citrus Industry Development Board and will repeal the Citrus Industry Act 2005. The winding up of the board will relieve the citrus industry of a regulatory burden that imposes compliance costs of the order of $3.3 million per annum on citrus growers, packers, processors and wholesalers.

The Citrus Industry (Winding Up) Amendment Bill 2012 is the result of an independent review of the South Australian citrus industry following industry calls for intervention due to discord and disagreement around the effectiveness of industry arrangements over many years. Although it is unfortunate that government intervention became necessary, it is pleasing to see reform is finally underway in this critical horticultural industry.

The review was conducted by retired District Court judge Alan Moss and was the sixth review or initiative into or affecting the South Australian citrus industry in the last decade. The citrus industry is an important contributor to South Australia's economy. The value of citrus exports from the state represents about half of all South Australia's horticultural exports. The Citrus Industry Development Board was created following the introduction of the Citrus Industry Act 1991.

Throughout the 1990s the board stabilised an industry which had previously been somewhat chaotic, and was generally welcomed and respected by industry participants. However, government policy had changed and the regulation of agricultural markets started to undergo significant revolution, or evolution, I should say, as Alan Moss states in the Citrus Industry Review report. I quote Alan Moss:

By the late 1990’s Government policy towards the regulation of markets had undergone a significant evolution. Rather than impose restrictive, anti-competitive regimes on industry, Governments were coming to the view that industry becomes more productive and efficient when competition and market forces are allowed to do their work, unrestricted by government rules and regulations.

This new approach required Governments to help to create a landscape in which industry was free to get on with the job, to provide things which only a Government can provide, for example certain quarantine and disease controls, and not to restrict competition by legislation unless it could be demonstrated that the benefits:

to the community as a whole, outweighed the cost of the restriction; and

of the legislation could only be achieved by restricting competition.

The South Australian Government entered into a Competition Policy Agreement with the Commonwealth Government which required the States to bring their legislation into line with the Commonwealth's competition policy. As a result and after very lengthy consultation with the citrus industry, a new Citrus Industry Act was passed in 2005. The Board's former role as a market regulator was abandoned, but the Board was retained in a new guise as the South Australian Citrus Industry Development Board.

Moss goes on to recognise that the retention of the board was, however, unusual. As far as he was aware:

the CIDB is the only board which survived the competition policy initiative and all the other industry boards were abolished and replaced by industry based bodies, or associations.

In South Australia, in addition to the board, Citrus Growers South Australia Incorporated (CGSA) and Citrus Australia Ltd (CAL) are two industry-based bodies which represent the citrus growers, packers and processors of South Australia. Citrus Growers of South Australia is the latest incarnation, being a long established grower-based industry association, and is supported by a modest levy on growers under the auspices of the Primary Industry Funding Scheme Act of 1998 (PIFS).

CAL is a relatively new membership-based national industrial body. Citrus Australia Ltd has slightly more than 250 members, but is growing slowly and steadily. CAL replaces a former national body, Australian Citrus Growers Federation, which was wound up by its members in 2008 in favour of CAL. Citrus Growers South Australia has links to CAL and is a supporter of it.

The attitude of the South Australian Citrus Industry Development Board towards Citrus Australia Ltd has at times been hostile. These three bodies, CAL, CGSA and the South Australian Citrus Industry Development Board, had all been competing for influence within the South Australian citrus industry, which led to an unacceptable level of tension between the bodies. The direct result has been the independent review by Alan Moss, which concluded that there was no good reason to retain the Citrus Industry Act 2005 or the South Australian Citrus Industry Board. As Moss notes:

This Review has occurred at a time of considerable stress and challenge for the citrus industry.

Progress in the South Australian citrus industry has been limited and disjointed because the structure of the industry is fundamentally unsound and disunity has been apparent for some time. Moss continues:

The citrus industry undoubtedly faces a period of structural adjustment being imposed upon it by irresistible outside forces. To survive in good shape the citrus industry will need strong leadership and unity. Government cannot legislate to provide these essential things, but it can construct policy and enact legislation which creates an environment in which they can grow.

I consider that this Review affords an opportunity to look over the horizon and to help the citrus industry establish a healthy and functional industrial structure to face the challenges of the years ahead.

As to the review of the South Australian citrus industry structures and what has happened in South Australia, we are being represented currently by two industry organisations. We have the South Australian Citrus Industry Development Board and Citrus Growers South Australia. Under the current structure, the South Australian Citrus Industry Development Board is funded by payments it receives from the Citrus Industry Fund, which was established under the Citrus Industry Act 2005. Citrus growers, packers, processors and wholesalers contributed to this fund, and this fund is managed by the SACIDB and used to execute its functions under the act.

Citrus Growers of South Australia was funded by payments it received from the Citrus Growers Fund, as mentioned, which was established under the Primary Industries Funding Scheme (Citrus Growers Fund) Regulations 2005. Only citrus growers contributed to this fund. The contributions were collected by the South Australian Citrus Industry Development Board and then transferred to Citrus Growers South Australia, via PIRSA, and used to execute its functions defined under the regulations.

A number of inefficiencies in the current legislative funding arrangements were recognised by the Moss review, including the duplication of a number of functions described in the Citrus Industry Act 2005 and the Primary Industries Funding Schemes (Citrus Growers Fund) Regulations. This means that the South Australian Citrus Industry Development Board and Citrus Growers South Australia held responsibilities for and were operating within similar areas, and it is possible that the organisation's views with respect to these areas may, in fact, not have been aligned. The citrus growers, in effect, were paying levies twice through the two separate mechanisms.

As already mentioned, the Citrus Industry (Winding Up) Amendment Bill 2012 will wind up the current South Australian Citrus Industry Development Board and will repeal the Citrus Industry Act 2005. The winding up of the board will relieve the citrus industry of a regulatory burden that imposes compliance costs in the order of $3.3 million per annum on citrus growers, packers, processors and wholesalers.

The Citrus Industry (Winding Up) Amendment Bill 2012 is the result of an independent review of the South Australian citrus industry following industry calls, as I mentioned earlier, for intervention due to discord and disagreement around the effectiveness of industry arrangements over many years. The review was conducted by retired District Court judge Alan Moss. As indicated earlier, it was the sixth review or initiative into or affecting the South Australian citrus industry in the last decade.

Ultimately, this review concluded that there was no good reason to retain the South Australian Citrus Industry Board or the Citrus Industry Act 2005. As a result of the review, the government was urged to bring to a halt any further division in the citrus industry and, in doing so, to set up a working party (the South Australian citrus industry transition working party) to formulate the structure and governance for a single unified representative body.

The South Australian citrus industry transition working party was chaired by the Hon. Neil Andrew, former federal member for Wakefield and also a former speaker of the House of Representatives. Neil has a strong background as a citrus grower and a strong connection to the Riverland. It is my understanding that the Hon. John Dawkins from the other place worked for Neil in the 1980s and early 1990s.

As a result of the South Australian citrus industry transition working party, it was recommended that an advisory committee, to be known as South Australian Regional Advisory Committee (SARAC), is to be established to represent the interests of the state's $350 million citrus industry. SARAC will fall under the auspices of Citrus Australia Limited (CAL), being an advisory subcommittee, and will be supported by a $1/tonne voluntary levy, collected via a PIF scheme and provided to CAL. Being a voluntary levy, it is like most primary industries funding schemes, where the money is an automatic collection. A grower can apply to have that levy returned if they wish, but, as I understand it, in the past, most have not. Under these changes, the Citrus Growers of South Australia, an organisation primarily made up of member growers, will wind up voluntarily.

To further explain the South Australian Regional Advisory Committee, SARAC's role is to respond to South Australian citrus industry issues, to maintain a local or South Australian focus on research and development priorities, to provide information and advice to Citrus Australia on South Australian priorities, to oversee industry development activities, to ensure the integrity of South Australian information in Citrus Australia's crop estimates and planting statistics, to communicate with contributors to the Citrus Growers Fund and the broader South Australian citrus industry, and to develop and update a five-year management plan for the Citrus Growers Fund annually.

With respect to its membership, SARAC will have a minimum of four and a maximum of seven members, and at least four members will be growers. Members do not need to be Citrus Australia Limited members. Members will be appointed for a maximum of four years with half retiring every two years. Members will be selected through nominations and will be skills based. Members will not be remunerated, however the chair or an elected representative may be reimbursed for time spent on committee business.

Citrus Australia's role will be to manage the fund according to a five-year management fund, and it will meet the minister's expectations that funds collected under the act are directed to SARAC for its activities. To support SARAC and the South Australian citrus industry, Citrus Australia will also have a role in national and regional advocacy, market access and development, promotion, information collection, communication, biosecurity and plant health.

Supply chain links and communication will stay the same, which is critical for SARAC to be an effective representative body. The Citrus Growers Fund associated legislation under the Primary Industries Funding Scheme Act will remain in place, however the fund contribution rate will change. Changes that will happen with this major revolution in the citrus industry include the fact that there will one united voice—wouldn't we like see that in all farming and agricultural pursuits?

The South Australian citrus industry will have one united voice for advocating and responding to regional issues instead of the two existing state-based representative bodies. With respect to the Citrus Growers Fund, there will be one state-based fund. SARAC will have access to payments from the fund for its activities. The fund contribution rate will be changed to a dollar per tonne of citrus produced. This is a significant reduction in the contribution rate and represents a saving of nearly 75 per cent, though I am aware that some people are concerned that that levy rate may not be enough. However, that will be up to industry to change that in the future in discussions, I believe, with the minister.

Packers, processors and wholesalers will not be required to contribute to the fund. These businesses will be encouraged to sponsor the activities of the South Australian Regional Advisory Committee. The South Australian Citrus Industry Development Board has wound up, I think, or is about to be wound up when this act is enacted. The Citrus Industry Act 2005 will be repealed (and that is what we are going through at the moment), which means that the South Australian Citrus Industry Development Board will be wound up and the Citrus Industry Fund will cease. The citrus growers of South Australia will not receive payments from the Citrus Growers Fund under this structure.

At this stage I would just like to read a couple of comments from the Riverland Weekly from 30 August 2012 and the comments of the South Australian Citrus Industry Development Board Chairman, Richard Fewster:

'Generally today we wished them well at our meeting and one of our directors is a member of the new SARAC board', South Australian Citrus Industry Development Board Chairman Richard Fewster said. 'During the South Australian Citrus Industry Development Board's final meeting it was decided that support and assets will be offered to SARAC. It was a unanimous decision of the board that we are going to provide an information kit to SARAC on things that are going on and information we have, so at least it gives them a standing start to make some plans for the future,' Mr Fewster said. 'We've also looked at the assets that are sitting there, like furniture and photocopiers and printers and we are suggesting to the administrator that they may be given over to SARAC to get them on the road.'

In consultation regarding this important bill for the citrus industry, I have had several meetings with key industry leaders and stakeholders, including members of the South Australian Citrus Industry Development Board and its CEO. I have spoken to and met with Judith Damiani of CAL. I have met with the President of Citrus Growers South Australia and the former president of the Australian Citrus Growers Incorporated Mark Chown, and I have attended a citrus industry transition working party meeting in the Riverland.

I was also present, along with a number of my colleagues, at a briefing provided to the opposition on this legislation, and I thank the minister for allowing her office and the department for that briefing. I commend my colleague in the other place the Hon. John Dawkins for his assistance and contribution. I also thank the member for Chaffey, Mr Tim Whetstone, who has the vast majority of the citrus industry in his electorate, for his important work on this issue. I also take this opportunity to thank the member for Chaffey for suggesting at that briefing that the expiry of the Citrus Industry Act 2005 be held off for at least one full citrus season to give the industry the best opportunity to see the new system in operation before the act expires.

As a result of these discussions the Hon. John Dawkins, on behalf of the opposition, introduced an amendment that will ensure the Citrus Industry Act 2005 cannot be repealed in its entirety until 1 January 2014. This will give the citrus industry the time it needs to experience and review the reform system over a reasonable period.

At this stage I thank the ministerial staff and departmental staff because these negotiations, especially in light of this amendment with a time line of 1 January 2014, was achieved through very much goodwill through the negotiations. I acknowledge the departmental staff for that goodwill. It is nice to see that, occasionally, you can make things work in this place. In conclusion, I indicate opposition support for this bill and commend it to the House of Assembly.

Mr WHETSTONE (Chaffey) (12:26): I, too, rise to support the Citrus Industry (Winding Up) Amendment Bill. I will speak briefly about my involvement with the citrus industry as a grower over 25 years, and now representing the majority of the industry in the electorate of Chaffey. Over that 25 years there have been a number of issues within the representative groups of the industry, and I guess coming in as a new player nearly 25 years ago I used to scratch my head regularly with the representative groups that used to have internal politicking, if you like, over views and ideas and trying to be power hungry or wanting to be the lead group or organisation to give representation to a vitally important industry, particularly in the electorate of Chaffey. I understand about 95 per cent of the industry falls within my electorate.

Over that 25 years I started as a grower and bought a property with an existing citrus business and was able to experience all facets of the industry, from maintenance on an existing property to developing land, to being able to plant and to understand just exactly what the industry has meant for over 100 years in the Riverland. The geography of the country up there is such that it has deep, sandy, free-draining soil, and we have a great climate not only for growing citrus but for living in general.

The industry that was worth some $350 million almost 25 years ago is still worth that amount of money today. I guess along the way we have seen a lot of change, a lot of change in market demands, particularly the ebb and flow of the commodity prices, the fluctuating demands. I guess over my time we have experienced drought and frosts, and they have had a major impact on the industry. In saying that, through the course of the drought we have had to deal with the citrus trees or orchards, which are reasonably high water users. A standard citrus property would use around 10 megalitres a hectare, and needs that to give you an opportunity to be a viable business.

Not only do you have to be variety driven to supply the markets with what they need but you also have to be production driven. Over the years we have been production driven with a simple variety of Valencia, which was probably one of the major drivers in the citrus industry, whereas nowadays we look at what mothers are packing in lunch boxes and at consumer demand.

The majority of that demand nowadays is for easy-peel. As most people here would know, mandarins, clementines, tangelos and the like are varieties that are easy to use. I must say, once upon a time you would pull a beautiful Washington navel out of a lunchbox and by the time you had peeled it you had juice running down your hands or running down your arms, and it was not always a great experience.

But today, these new varieties are easy to peel, easy to eat and very, very sweet. That said, those traditional varieties (such as the Imperial mandarin) versus the newly released Afourer mandarin are varieties that again suit export demand, they suit market demand domestically and, more importantly, they return a better dollar value to the grower.

I guess there are many reasons why the Riverland is so important to the citrus industry, particularly now with over 400 growers. It has been underpinned by the longstanding families who have brought the industry into the 21st century and are proudly representing the Riverland brand that has been iconic all over the world. The small sticker that you would see in a fruit and veg shop or a market domestically or overseas is iconic. That Riverland brand tells you that the orange is grown in the Riverland, fruit fly free, and probably of the best quality in the world. It really just highlights the importance of the Riverland to the industry.

Also, many people would have experienced (particularly on a plane flying around the country or even overseas) the small container of orange juice produced by the iconic Berri brand. I am sure that everyone in this place, at one stage or another, has sampled the Berri brand. There are many new brands, varieties and styles that we consume today, and that is underpinning an industry that has been besieged by cheap imports, particularly of concentrates that come from Florida and Brazil. There is a very cheap labour force over there that makes it very hard for us to compete.

Some of the destinations of some of the citrus products—obviously, the table product is something that is a premium that we enjoy here, particularly the Washington navels. The Riverland is classified as growing the best Washington navel in the world. We are classified as growing the best Late Lane (or Summer) navel in the world. Our Eureka lemon is iconic, and is the best lemon that has gone into the very finicky Japanese market. We have enjoyed the fruits and great rewards of exporting our produce into the USA and Asia and, particularly as I have said, into Japan.

But, over time, the ever-changing demands and pressures on the industry have seen high prices. When I started my experience as a citrus grower, prices were as low as $65 a tonne. Just to give you an idea, nowadays it costs you about $80 a tonne just to pick it, let alone to grow it, market it, get it to market and put food on the table. They have really been challenging times.

We have had great, prosperous times with perhaps a shortage in the market, and perhaps a shortage in the processing industry with the juice requirements, and we have reaped the rewards of around $600 a tonne. But, I guess, today we are looking at very lean times. The citrus industry has been besieged by the high Australian dollar and the drought. We have seen a lot of negative media showing the heartache that growers have endured after planting a tree some 20 years earlier and having to push that orchard out or, in some cases, removing all of the trees in their orchard due to financial issues with the market resistance to taking a variety. In a lot of cases growers have had to leave fruit on the trees because it was not viable to even consider taking them.

I really think that nowadays, coming away from a citrus grower and as the member for Chaffey representing, I guess, about 95 per cent of the industry, I am now representing the views not only of growers but of packers, marketers, exporters, nurserymen and the banks. I had regular meetings with the banks throughout the drought, and there was also that rebuilding process of just how the banks could support the citrus industry and how they have supported it, and I would like to think that they see it as a viable business into the future.

I have really just summarised the importance of the citrus industry to South Australia, but there is also the diversity, which I have not mentioned. We have talked about the juice industry, the market industry, but we are now looking at diversity within the industry, growing citrus not for eating but for flavours, for cooking and for the oils, particularly from the peel. If you have ever got your hands dirty you might have used some of the hand cleaning products that are commonly known as 'Big Orange' or 'Hard Orange'. It is a fantastic hand cleaner and it also smells nice—and let's face it, there are not too many hand cleaners that do have an appealing smell.

We are moving into a new era of representation within the industry. In saying that, I have had concerns for over 25 years with the representation, after experiencing the three groups that represented the industry here in South Australia: the Citrus Industry Development Board; the South Australian Citrus Growers; and, more recently, Citrus Australia, which has now come on board.

The government has seen fit to work with the Moss report. Alan Moss, a former judge, interviewed some 60 growers and packers to get a hand on exactly what the concerns of the industry have been. I was concerned that that report came back with quite an agenda; I think I can safely say that the Moss report did have an outcome-driven agenda, but I think it was for the betterment of the industry. I would like to think that the report had a lack of understanding of the long-term future of the industry; it was more about underpinning the frustration with what we have experienced over a number of years with, as I have said, the internal politicking of the representative groups. They would undermine one another, and it was always to the detriment of the industry. The industry was really held back in a lot of instances, with these groups having their own agendas and their own self-interests in a lot of cases.

However, they also did a lot of good, and we cannot take that away from them. Over those many years of representation they did achieve good outcomes. Some of those outcomes, particularly with the Citrus Industry Board, had great outcomes with biosecurity. They had a good impact on some of those emerging export markets, particularly in collecting information and data. That was very important for me as a grower, and it was important for the industry as a whole just to see what the trend of plantings was, the trend of market requirements, and exactly what the planting schedules were within South Australia, so that growers could make informed decisions.

When a grower plants a tree they do not plant it for a five-year period; they plant a tree for the long term. In many cases there are trees that are 100 years old, but in many cases today there are also trees that are put in for, hopefully, a 20 year period. If those growers have the best information they could rest a little easier knowing that they were planting a variety that was there to suit an emerging market or an emerging demand. I think that data and information gathering was very important.

Of course, we needed to know what was happening in the markets on a weekly basis so that we could see how our fruit was going and whether we were looking at prices firming or dropping away. It would give an indication to a grower whether it was worth considering his picking program or whether it was worth holding back.

In the citrus business we had the luxury of being able to hold back some of those varieties on trees. Some varieties have a month window for picking, getting it into market and getting a premium price if the price was not there. For instance, with a Valencia, I can tell you that I have had three crops on my tree at once. I have had three years of fruit that I have been able to hang on to and hold back for the sake of securing a better price, or securing a price for my business to stay viable. That is something that is quite unique in any fruit or produce, to have three pieces of fruit from three different seasons sitting on the tree all at once. That was perhaps a luxury.

Getting back to the reason for the winding up bill, we went past the Moss report, and we dealt with the government looking at that report and endorsing a transition working party. As the member for Hammond has said, that was chaired by the Hon. Neil Andrew, who is a citrus grower himself. I was very happy to see that the minister had given him the role of chair of that working transition party because he does have an understanding of the hardships endured by being in the citrus industry and that he had experienced himself—the internal bickering and internal representation groups that had dragged one another to the ground so often.

In saying that, I would also like to think that the SARAC group (the South Australian Regional Advisory Committee) that has now been appointed will be a transition group that will determine whether Citrus Australia will be the answer for the industry. To date, Citrus Australia represents only about 10 per cent of the industry, and I think it is up to them to secure better membership numbers; but it is also up to Citrus Australia, as a national body, to represent the interests of the South Australian citrus industry. They need to understand what varieties we have in place and they need to give us a clear indication of varieties that could be better planted.

I see that a majority of the plantings here in South Australia are under five years old, so that is a work in progress. As I say, growers have removed old and non-viable plantings, so that information needs to come out to growers, and continue to come out, and needs to be there for the betterment and sustainability of the industry.

Now SARAC is coming on board, appointed by the minister and her department. I would also like to acknowledge my meetings with the minister and her department and PIRSA. They have listened, and I think that is a credit to them. I went to the minister and her departments with the best interests for the citrus industry. I did not go there for any political gain or with any agenda. I went there for the betterment of the industry. It is great to see that SARAC will pick up the mantle, and it will be proven over the next citrus season, until 1 January 2014, whether Citrus Australia is the best placed representative group for the citrus industry in this state.

I do have some concerns with the levy that is on every tonne of fruit, which was somewhere in the vicinity of $3 (it does vary with different varieties) and is now down to $1. I think that was a knee-jerk reaction. The industry was going through a tough time and they decided to make it $1 a tonne. I will stand corrected that $1 will not be enough, particularly for running the administration side of things and a liaison officer. For the costs of actually running this committee, it will not be enough, but I think we will let time tell.

Another concern I have is with what is going to happen with South Australian produce that is sold over the border. How will SARAC benefit from that fruit that goes into Victoria and goes into New South Wales? As I understand it today, those levies will not be collected here in South Australia. Again, I do have concerns.

I am also concerned that we are still under a five-year moratorium with the exit properties that some of the growers took for different reasons, whether it was for drought or financial reasons, being sick of the industry or they had just got to the age where they had had enough. That moratorium should have been lifted and it will not be lifted by a state minister: it has to be lifted by the federal minister. That would enable the region to move into the next phase of the industry and be able to introduce new varieties and plant that ground. It has the infrastructure past the front gate, and it is vital that that transition is supported by not only the state government but by federal government.

I welcome SARAC. I welcome the amendments that reflect some of the shortfalls with the winding-up bill and seeing those amendments supported. I wish the citrus industry of South Australia every success, led by a strong, united, single voice of SARAC here in South Australia. If Citrus Australia can step up to the plate and represent the industry here in South Australia, I applaud that.

Mr VAN HOLST PELLEKAAN (Stuart) (12:46): The Liberal Party supports the Citrus Industry (Winding up) Amendment Bill 2012 but has also tabled an amendment to assist the industry in transitioning to the new arrangements. Most of the issues have been covered exceptionally well by the shadow minister for agriculture (the member for Hammond) and also the member for Chaffey who, as he said, represents 90 to 95 per cent of the citrus industry in South Australia. He lives and breathes this every single day and represents the people of Chaffey extremely well.

I would like to draw attention to one comment that he made straightaway, that is, that the citrus industry in South Australia is an approximately $350 million industry, and it is a bit sad to say that it was that about 20 years ago. That is clearly not good for any industry and the citrus industry certainly faces many challenges, and I will get to a couple of those in just a minute. I would also like to quote something said by the member for Chaffey in July that really encapsulates this debate:

The SA citrus industry has made it clear it wants a single body to represent its interests at the state and national level, however, there has been some concern at the haste with which the government has moved to change the arrangements...

I think that is a pretty straightforward statement and really encapsulates the Liberal Party's position. Of course, that is why the Hon. John Dawkins in the other place has moved the amendment on behalf of the Liberal opposition which would mean that the transition cannot take place until 1 January 2014 at the very earliest. I think that is a very wise amendment, and I hope it is adopted everywhere because it gives the industry time to ensure that it makes the best possible transition.

As the member for Hammond mentioned, representation in agriculture in general is a very difficult issue. At the same time as we are working through these issues with the citrus industry, we are also working with agriculture more broadly and SAFF as they go through a very important transition.

Certainly, the most important aspect of this as far as I am concerned is that the industry wants to be represented by one body at both the state and the commonwealth levels. In that vein, I put on record my view that, among other challenges facing the citrus industry, one of the most important at the moment is that of food labelling, which can be addressed by both state and federal governments but is probably more a federal than a state responsibility.

Food labelling is an exceptionally important issue because, of course, while we are talking about the citrus industry, we are not only talking about the retail sale of oranges to end consumers, and the member for Chaffey has touched on this issue. There is an ever-growing number of uses to which citrus products are put, including, as he said, hand-cleaning products. He is probably a bit more of an expert on hand creams than I am. I am ashamed to say I was not aware of that one, but the member is an expert on all facets of this industry.

I represent the electorate of Stuart. The Morgan-Cadell-Blanchetown-Murbko area, that top corner of the Riverland, is in the electorate of Stuart. It is a very important part of the electorate of Stuart. I am familiar with these issues and I would say that, unfortunately, the town of Cadell has probably suffered more than any other in the Riverland over the last several years. Cadell has suffered as the citrus industry more broadly has suffered with exposure to international markets, exchange rates, drought, the broader issues associated with the River Murray, pressures associated with long-term cropping (I will come back to that in just a minute) and also pressures that have come from the government.

Issues like the Cadell ferry have not helped the citrus industry at all. While I thank the government very genuinely for reversing its decision, I think it is absolutely disgraceful that it ever considered let alone took steps to remove the Cadell ferry from that community and the surrounding district. If it were not for the work of the community, supported by local members of parliament—and, importantly, communities a long way away from Cadell—the government would not have reversed its decision. It is a very important example of the challenges faced by the citrus industry and the part of the Riverland that I represent in the electorate of Stuart.

I will come back to the pressures of long-term cropping, which the member for Chaffey also touched on in his remarks. We are all very familiar, on this side of the house, with pressures placed on agriculture and cropping industries. To plant a crop that you hope to reap rewards from for 20 years or more, and even longer term in the wine grape growing industry, is a significant challenge. To face those issues of exchange rates, droughts, international markets, etc., when you are trying to plant a crop that should support you, your community, your business and your family for, ideally, decades is a very difficult issue.

I hope the new industry representation arrangements will deal with those things. Some things are outside government control but some things are certainly within government control, and I come back again to food labelling. Price will always be important, and I am an advocator of free market economies. Food labelling is a particularly important issue because it allows consumers to make informed choices and, as I said, not just about the oranges they might choose to buy at the supermarket and whether they come from California or the Riverland or any other part of the world.

I say quite plainly that people on very tight budgets trying to do the very best they can by their families cannot be blamed for pursuing price. Let me say that very clearly. It is an important issue. People must consider price in their daily decisions with regard to how they spend their disposable income. Fortunately, in South Australia, and other parts of Australia, we have a large number of people who are not under that amount of pressure that they cannot consider supporting their local industries. That is a very important issue. I think the overwhelming number of people in South Australia would support the South Australian citrus industry if they possibly could. So, food labelling is a very important issue in that regard.

I close by saying that the opposition will always do everything it can to support the South Australian citrus industry, and no more than at the moment. We offer our services at every level with regard to the transition to one representative body at a state and federal level between now and the year 2014.

Mr GOLDSWORTHY (Kavel) (12:55): I want to make some comments in relation to the Citrus Industry (Winding Up) Amendment Bill. As has been highlighted in the house previously by the member for Hammond, the lead speaker for the opposition, and very comprehensively by the members for Chaffey and Stuart, the citrus industry in this state has recently undergone an independent review following calls from the industry for intervention in relation to a number of issues.

As has been previously highlighted, the decision has been made that one body be formed and, as a consequence of that, the Citrus Industry Act 2005 will be repealed. The winding up of the board will relieve the citrus industry of a regulatory burden that imposes compliance costs in the order of $3.3 million per annum on growers, packers, processors and wholesalers.

The outcome of the independent review was the appointment of the South Australian Citrus Industry Transition Working Party to formulate the structure and governance for a single industry representative body. That working party recommended the establishment of an advisory committee to be known as the South Australian Regional Advisory Committee to represent the interests of the state's $350 million citrus industry which will fall under the auspices of Citrus Australia Limited (CAL). That is the outline and some of the background to the legislation before the house. As has been previously highlighted, there has been an amendment successfully moved in the other place which we regard as an improvement to the legislation.

I want to make a few comments myself about broader issues that relate to the citrus industry. I worked in the Riverland region for the best part of three years in the early 1980s. From that, I like to think I have an affinity with the region. I met and married a girl from the Riverland and that marriage is still going along quite successfully, I like to think.

The Hon. P. Caica: That's what you say!

Mr Pederick: Yes, what's her version? We want her right of reply!

Mr GOLDSWORTHY: Every time I raise this issue and whenever we talk about the Riverland, I always cop some flak about that, but I do like to think I have an affinity with the region. Some of my wife's family, some of my in-laws, my wife's aunts and relatives, and my brother-in-law still work in the Riverland in an industry directly related to primary production. From time to time we enjoy holidaying in the region.

The DEPUTY SPEAKER: And the member will get back to the bill.

Mr GOLDSWORTHY: Well, this is related to the bill. Can I seek leave to continue my remarks after the luncheon adjournment?

The DEPUTY SPEAKER: You can seek leave but whether the house gives it to you or not is a different matter. You are seeking leave to continue your remarks.

Leave granted; debate adjourned.


[Sitting suspended from 12:59 to 14:00]


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