News

Sound of grassfed cattle industry reform: crickets chirping

James Nason, 25/07/2017

It’s been two years since Cattle Council of Australia and various self-appointed grower groups agreed on a new restructure model to improve grassfed cattle producer representation in Australia.

The new structure would see Cattle Council of Australia and its current State Farm Organisation (SFO)-based membership model replaced with a board of fully directly-elected directors. It would give all grassfed levy payers across Australia a say over how their levy funds are spent, and the ability to vote in, or stand for, industry elections.

The sound of the reform process since that time: crickets.

The big sticking point still remains funding.

By their actions a majority of producers have shown they are not interested in paying for membership of CCA (either via an SFO or directly) in its current form. Some say they already pay levies, and shouldn’t have to reach into their pockets again for the right to say how that money is spent.

But a new organisation needs to be funded.

The key target for several years has been levy money.

A senate committee recommended that a new grassroots producer body be established and all funding generated from the $5/head grassfed cattle levy go to that body in future (not directly to Meat & Livestock Australia, Animal Health Australia, the National Residue Survey as it currently does).

Years of debate have failed to convince the Government to agree to give a grower group direct levy funding. The Government’s view is that the senate committee overlooked the fact that levy funding is in fact tax money and cannot be controlled by what would be essentially a lobby group.

Driving the restructure process for the last few years has been an implementation committee representing groups such as CCA, Australian Meat Producers Group, Australian Beef Association etc. Some of these groups have unknown/unreported industry membership but have been afforded a strong level of representation on this committee (the membership of which is detailed below), more than the peak industry council itself.

The group’s inner workings and deliberations have been closed and are not often publicly discussed. For a process aimed at improving how grassfed levy payers are represented, grassfed levy payers themselves, apart from those on the committee, seem to be still very much in the dark about where the process is up to or where it is going.

Depending on the outcome of an application for Federal funding, that could change soon.

The committee has recently submitted an application for a share of the $5 million “Leadership in Agricultural Industries” grant fund, pledged by the Coalition Government before the last election to help farm representative groups develop leaders’ skills and lead their industries through transitional and structural adjustments.

The word is that dozens of other farm industry organisations have also applied for a share of the $5m fund. (One unconfirmed account suggests applications for the fund have been massively over-subscribed, and if all applications were totalled, the fund would need more than $25m to satisfy all requests.)

The fate of the funding application in that competitive environment is not yet known, or how much the grassfed cattle industry may receive.

How that money can be used is also subject to tight parameters. It is understood that one use at least some committee members are lobbying for is for the money to help fund first the identification of, and secondly a plebiscite of, all levy paying producers across Australia, so actual grassroots support for the proposed restructure model agreed to by grower groups back in February 2015 can be gauged. (We haven’t yet been able to clarify if the funds could be used for this purpose and are aiming to follow this up for another article).

There has been ongoing talk that Cattle Council of Australia’s representatives do not always participate in implementation committee meetings or phone hook ups, which detractors have interpreted as CCA not being committed to the restructure process, and as evidence that the council is only seeking funding so it can continue to operate as it currently does.

When quizzed about this by Beef Central this morning,CCA president Howard Smith emphatically rejected that was the case.

“We’re still working with the group, and exploring options,” he said.

“We have got a meeting with some of the group on Friday to discuss the way forward.

“We have been told categorically (by the Department and Ag Minister’s office) we’re not going to get a portion of the levy, that is off the table, so we are exploring other options and working with MLA and the Department, and looking at other ways forward to support some of the work Cattle Council does.

“Obviously we still want to transition towards the new direct elected model.

“Allegations that we’re dragging the chain are totally false, we are wanting to move to that direction.

“We have got the model, we’re just trying to work out ways of funding it.”

Members of the Implementation Committee are:

Chair, Troy Setter, Northern Pastoral Group (NPG)

Howard Smith, President of Cattle Council (CCA)

Cattle Council CEO, (Position not currently filled following recent resignation of Duncan Bremner)

Peter Hall, Director, CCA

Brett Hall, Director, CCA

Tom Stockwell, Northern Territory Cattleman’s Association (NTCA)

Ernie Camp, President, Australian Beef Association (ABA)

David Byard, Executive Officer, Australian Beef Association (ABA)

Norman Hunt, Rural Industry legal advocate, Australian Meat Producers Group (AMPG)

Cameron McIntyre, AMPG

Ashley McKay, AMPG

Joanne Rae, AMPG

Paul Wright, AMPG

Linda Hewitt, ABA

Loretta Carroll, Ovens Valley VFF

 

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Comments

  1. John Carpenter, 31/07/2017

    I refer you to the initial announcement by MLA in 2004 when the LPA was first sprung on cattle producers which stated that the LPA was voluntary but then went onto to say that all of the processors would require an LPA/NVD.In order to make such an authoritative,unequivocal statement in effect committing the processors to the LPA there would have obviously had to be a prearranged agreement or deal.There is absolutely no element of hearsay in my comments.

    MLA made no such statement, John. Acting independently, processors themselves stated that they would only buy cattle under NVDs from a certain date. Their decision was based on a desire to protect international markets from potential residue issues, etc. There was nothing mandatory about it, and certainly not mandated by MLA. We suggest you contact Ross Keane, then livestock GM for AMH, to ascertain what happened, and when. Editor

  2. John Carpenter, 28/07/2017

    Yes it is true that the LPA is “voluntary”.It is voluntary as long as you are content to breed cattle and leave them in the paddock until they drop dead.However if you need to generate cash flow in order to meet the payroll,pay suppliers etc it is not voluntary rather it is compulsory.The very cute deal stitched up in 2004 between MLA and the processors made it impossible to sell cattle to the supermarkets or the processors without an LPA/NVD.Readers can make up their own minds on just how “voluntary” this regime is.

    Thanks for your comment, John. What evidence do you have over a ‘deal’ being done between MLA and processors over LPA, please? You will note in our reader comment conditions that hearsay is not grounds for making such claims, without a solid basis in fact. Editor.

  3. Rod Dunbar, 27/07/2017

    Dear Editor
    With respect; yes LPA rules state that it is voluntary but the fact is that one cannot buy or sell any livestock prescribed in the AMLI Act nationally without LPA. Not one of our subscribers are members of MLA but all are forced to comply with LPA without Indemnity Insurance or face bankruptcy.

  4. Rod Dunbar, 27/07/2017

    Dear Editor
    pardon my poor use of the English language; Dexa may well be owned by MLA but the automated boning system that is being simultaneously installed into the processing plants is owned by a New Zealand company which is owned by JBS, that was printed in QCL.

    I apologize for my breach of your rules.

    I am acutely aware of Beef Central’s policy – there would be not a single USA subscriber that is unaware of your Policy; I will try very hard in future to adhere to your rules but at the same time, pray each night for true democracy and freedom justice and liberty for the vast majority of us, to be enjoyed at some point in the future.

  5. Eion John McAllister, 27/07/2017

    Everything that is involved in LPA is covered by existing legislation and attendant regulations at either Federal, State or Local level. All producers are therefore bound to meet those requirements. LPA is a non-voluntary scheme* which forcibly requires producers to participate. It is a redundancy as it simply replicates the requirements of existing legal obligation. The onus is upon gov’ts and regulators to oversee the laws and regs that they institute and to manage compliance issues if they are identified. That is why we pay taxes to pay for organisations such as the Police Services to identify legal non compliance and to manage those matters. Their onus is to prove that non compliance has occurred. The key point is that the regulatory bodies have to prove that non compliance has occurred. LPA reverses that onus of proof from legal and regulatory agencies and requires producers to prove that they comply. It’s a con, pure and simple.
    Can you imagine the outcry if this system was applied to parenting. All Parents were required to compulsorily pay for a Children’s Parenting Assurance Scheme where they would be compulsorily audited, require Nutrition Plans, Child health Plans, Biosecurity Plans, Transport assurance,. I think you get my drift .
    The comments above are well considered, highlight the reasons why the system has little support from producers and continues to breed resentment, anger and disgust with how money compulsorily extracted from producers is applied by these organisations.

    * That statement is not correct, Eion. LPA is a voluntary system. Editor

  6. John Carpenter, 26/07/2017

    We all know that the cattle transaction levy is compulsory and therefore a tax levied on cattle producers by the Commonwealth.We all know that cattle producers have never been allowed to vote on the levy.Neither did they ever democratically elect the CCA as their representative.The CCA does not represent cattle producers it represents the government who appointed it and prescribed it as a “Body” to regulate it’s interest in livestock that it also “prescribed” under the AMLI Act 1997.”Prescribed” is an intentionally vague sounding word but it is a synonym for seized,taken,nationalised,expropriated under force and without compensation.The CCA’s largest revenue source is it’s recent contract for the provision of “services’ to MLA,itself an agency of the Commonwealth and another Prescribed Body.This contract amounts to $750,000 p.a.These services are unspecified and as far as I am aware not subject to competitive tender.As MLA is funded by producer levies this contract amounts to levy laundering which makes a mockery of the proposition that levy funds cannot be used for political advocacy.The CCA is theoretically meant to act as a check on MLA but this contract creates a massive conflict of interest for the CCA and destroys any pretence of independence.The CCA’s second largest funding source is it’s annual distribution from the Net Industry Reserve Fund paid via the RMAC,itself another “Prescribed Body”.The answer to the CCA’s (or any successor organisation) funding dilemma is for the Government to simply increase the amount of this distribution.The last time I checked this fund was about $45,000,000 so this is not a constraint. But they won’t do it…why? Cattle producers should be terrified by the new LPA regime which in my view represents the coupe de grace by the Department of Agriculture in the nationalisation of cattle production in Australia.Your name may be on the title deed but the bureaucrats in Canberra and North Sydney are going to dictate the terms under which you will be allowed to operate your property.You will also be paying a fee for this privilege which I calculate will bring in another $4,500,000 p.a. on top of the levies already paid.Now there’s an innovative source of funds for the CCA.

  7. Rod Dunbar, 26/07/2017

    As far as we are concerned our subscribers would like the CCA chain to continue to drag indefinitely.
    There is no support for a mandatory membership and mandatory funding model whatsoever, additionally CCA and its subsidiaries are simply political organizations and cannot be legally funded by a federal Tax constitutionally anyhow.
    As to the rest of the “compulsory industry” the decision to co-fund the Dexa system to economically benefit the processors and their vertically integrated partners and the feedlot industry, which is principally owned by the vast foreign owned processors, certainly will not win friends or support in the grass-fed sector – they are so far removed from reality they cannot seem to see that thousands of CTL payers that don’t even use meatworks are required to compulsorily support the $150 – $180 million; we have no choice!!
    Is that just stupidity or do they know they have the power to decree such actions to their private benefit under the current Memorandum’s political arrangements? We all know that Dexa and its automated boning system (owned and patented to JBS)* will ultimately be used to discount the thousands of producers who are not within that inner circle.
    Ultimately, the reason for zero support for any private grass-fed organization nationally is the fact we are under the oppressive yoke of compulsory membership/ taxation within the RMAC/MLA/CCA structure, we already have one why do we need a second one??
    Don’t forget the Senate recommended that RMAC be wound up, an audit of RMAC/MLA/CCA activities be established by the ANAO, and effectively the separation of the processor/feedlot industry from the Grass-fed by the adoption of an Australian version of the USA “Stockyard and Packers Act”, just to mention a few.
    Nothing has happened and nothing will while the RMAC/MLA/CCA remains in place, it must be deregulated.
    It’s to be hoped that CCA cannot financially replace the chain once its worn away!!!
    Rod Dunbar – Director – United Stockowners of Australia

    Rod – your comment suggesting that JBS owns DEXA* is factually incorrect. DEXA – and most critically, the algorithms that make it what it is – are owned outright by MLA. Beef Central extends a note of caution to readers over checking the facts expressed in any claims made in reader comments. In future, such reader comments will simply not be published – no questions asked, or quarter given. Readers are encouraged to familiarise themselves with Beef Central’s quite specific requirements regarding reader comments – click here to view. Editor

  8. Ron Shaw, 26/07/2017

    Behahaha, let us at least get the descriptions right!
    To say that the “chain is dragging”, implies there has been “some” forward movement or “progress”.
    Instead, perhaps you could say “the dust has buried the carcass” ?!? lol

  9. John Armstrong, 25/07/2017

    The delegate’s funding issue was as plain as the nose on everyone’s face, had they cared to look.

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