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House of Assembly - Fifty-Third Parliament, Second Session (53-2)
2017-05-17 Daily Xml
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Dairy Industry

Ms COOK (Fisher) (15:07): My question is for the Minister for Agriculture, Food and Fisheries. What do the recent announcements by Murray Goulburn and the ACCC mean for the South Australian dairy industry?

The Hon. L.W.K. BIGNELL (Mawson—Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Tourism, Minister for Recreation and Sport, Minister for Racing) (15:07): I thank the member for Fisher for her question. Of course, this time last year we were all very concerned about the future of dairy farming, not only here in South Australia but across Australia, after Murray Goulburn sent out a notice to their suppliers that they were taking the milk price down not only for the future but also for the previous 46 weeks of payments that these dairy farmers had received, and they were going to force people to pay it back.

We were the first government in Australia to respond to that. We got out there with money to help people initially with the huge psychological damage that was done and then to help them do some financial planning to get back on track. There were people coming in here attacking us over this and what I kept saying was, 'We aren't the bad guys in this. This is actually Murray Goulburn and those dairy processors who have done the wrong thing.' While we wanted to help dairy farmers back on their feet, the people who had to ultimately pay the price were those who had done the wrong thing.

I am glad to say that we went after these companies by writing to the ACCC and also to the parliamentary inquiry. I am not sure whether the people who came in here and attacked us over this made any submissions to the ACCC or to the federal government inquiry, but I do hope they did so because that is where things get fixed up. Last month, the Australian Competition and Consumer Commission announced the start of proceedings in the Federal Court against Murray Goulburn alleging that it had engaged in unconscionable conduct and made false or misleading representations in contravention of Australian Consumer Law.

As I said, I have written to the ACCC twice to raise issues associated with the actions and processes in the dairy industry and impacts on our dairy farmers, and I am pleased to see that the ACCC has taken this matter so seriously. I understand that the ACCC decided not to seek a financial penalty against Murray Goulburn because, as a cooperative, any penalty imposed could directly impact on the affected farmers. The ACCC's agribusiness section is also conducting an investigation into milk contracts with the step-down provisions after accusations of unconscionable behaviour. It is due to present its final report by 1 November this year.

On 2 May this year, Murray Goulburn announced its decision to close manufacturing facilities in central Victoria and Tasmania. Murray Goulburn also announced it would forgive all future repayments of the Milk Supply Support Package and refund contributions made by suppliers. I welcome the correction of this terrible decision, as I considered the Milk Supply Support Package to be fundamentally unfair and a key factor in Murray Goulburn losing milk supply volume.

The Australian parliament has also conducted an inquiry into the dairy industry, with the Senate Economics References Committee now due to report on 29 June this year. Primary Industries and Regions SA provided one of the 41 submissions to this inquiry. Again, I would like to thank the ACCC and the federal parliament for the work they have done to address this problem that has hit farmers very hard not only here in South Australia but also farmers in areas of New South Wales, Victoria and Tasmania.

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