Pastoral Lease Rents

28 Mar 2012 archivespeech

This speech is in relation to the increase of Pastoral Lease Rent. It looks at the importance of the Pastorilists to South Australia's primary industries, and outlines the issues of rent increase, especially in a time when some lessees are still recovering from drought.

The Hon. J.M.A. LENSINK (16:44): I move:

That this council— 1. Calls on the Pastoral Board to re-form the Rent Review Committee over its decision to increase pastoral rents by up to 230 per cent; 2. Condemns the Weatherill Labor government for once again failing to consult with those affected; and 3. Notes the important contribution of South Australia's pastoral sector to primary product.

This is a fairly recent issue which has come up and which is affecting people in the Far North, in the country of the member for Stuart, Mr Dan van Holst Pellekaan. There may well be some in some other areas, but I note that it predominantly affects people within his electorate.

The pastoralists are very important to South Australia's primary industries. They predominantly farm meat, wool sheep and cattle in that region. I think it is fair to say that they are subject to some climatic conditions that are quite different to other parts of South Australia. For them, this rent increase has been another case of announce and defend by this government. The rates have been bumped up after the recent breaking of the drought in that region. What the government has said in relation to its rationale for increasing rents by, in some cases, 230 per cent, is that the formula for calculation is based on varying land types and each has a ranked value which reflects its potential to sustain different stock levels. The quote from the office of the Department of Planning, Transport and Infrastructure is:

The land is the base your income lies on and so it needs to be given appropriate value and we consider distance from market, land values and climatic conditions. Market values move and we need to follow.

On the face of it, that sounds like a fairly reasonable proposition. However, I think the pastoralists affected would like to understand to a much greater degree how those particular values have been reached. The member for Stuart is seeking the basis of the unimproved capital value—he has an FOI application in. I think the people affected are finding that this process is not at all transparent.

The government has described the rent increases as a so-called catch-up. Unless we have some sort of massive increase in valuation in the Far North, I am not sure how a 70 per cent, or 100 per cent or 230 per cent increase is any form of catch-up. I am not quite sure what sort of accounting methods are being used by the department to come at these rent value increases. The other thing in this whole issue is that the lessees should have been given some forewarning. If you are going to vastly ramp up these sorts of rentals then you ought to at least talk to people first to give them some idea that this may be taking place.

The reality of the Far North and what has been taking place there is that there is still some recovery up there. In question time yesterday there were a series of questions directed to the government, and the minister for primary industries in this place, and she herself described how there has been quite a lot of damage because of the floods. Australia, in that part of the world, is quite flat and so floodwaters do flow very easily from one place to another. In other parts of Australia we have large wide rivers which can take the flow and feed that through the landscape, but in these areas it often flows across flat areas and can hamper feeding and transport to market.

So, while those of us who are urban South Australians may gasp at the proliferation of wildflowers and declare that we have never seen the landscape looking so wonderful, there are other issues that will affect people who are based on those lands which will affect their livelihoods. Transport to market is a problem because of those floodwaters.

The lessees themselves have stated that some of them are still recovering from drought and are working on less than half their usual stocking rate. So, in terms of the numbers, just because they have had a break in the drought does not mean that suddenly they have the financial capacity to be raising a lot of stock, because they just do not have the numbers.

It has caused so much consternation that I understand the SAFF livestock committee has stated that it wants a united response. I think that is a sensible approach, where this government is concerned. I do not think it would be advisable for individual pastoralists to allow themselves to be picked off one by one. SAFF has gone to the point of setting up a rent review committee of its own. I think the recommendation that the Pastoral Board re-establish its Rent Review Committee would be a much less complicated way to address the inequity so that it can be looked at across the board and whether or not the values that the department has come up with are valid.

The member for Stuart has raised this issue in parliament in recent weeks. As I said, he has lodged an FOI and he has organised a meeting with the head of the Pastoral Board. I am disappointed that the minister effectively refused in question time yesterday to support the re-establishment of a rent review committee, and she also does not support a shift in the responsibility of this policy area from the environment area to her own department.

I think in the interests of transparency, these rent increases need to be reviewed. The government needs to make sure that people have a fair valuation; otherwise, the industry that South Australia relies on for a large part of its primary resource income may not be viable and people will not continue to farm in those areas; therefore, I urge members to support the motion.

Debate adjourned on motion of Hon. J.M. Gazzola.