Interview with Micheal McLaren, Sky News

31 December 2020

MICHAEL MCLAREN: Let’s start with the positive. We’ve got to start with the positive, David, and that is the rain. Of course, this time last year was a story of desperation across much of eastern Australia, in particular. Twelve months on, basically a miracle from the sky has fallen, and of course for a lot of farmers rain equals money, doesn’t it?

DAVID LITTLEPROUD: It sure does, and no matter what a federal, state or local government does in terms of support, the one thing that changes the psychology in the bush for farmers and the communities that support them is rain. Once it starts raining, farmers start spending and that has a flow-on effect through towns. So no matter what we did in terms of the drought, there’s over $10 billion that the Australian taxpayer put out there for Australian farmers during the drought, as soon as it rains you can just feel the psychology of the whole place change. And we’ve had some not only across New South Wales and Victoria but even up in Queensland now. There was some 110ml just down the road from where I live a couple of nights ago that’s really put some water through. We need a lot more. You need about three or four average seasons to get people back up on their feet. But as soon as it starts raining, people start spending money, they have the confidence that they’re going to make a quid, and that’s where we are at the moment. So hopefully, even though they’re now saying La Nina isn’t as strong as what it was, it still is there and that means we probably will have an average season, which is great news for agriculture and great news for regional Australia.

MICHAEL MCLAREN: Yeah, that’s it. You don’t want floods, that’s the other thing. So if it’s sort of a decent La Nina without the full kick, I think that’s probably what you want. Of course, the key, though, is when it does rain you’ve got to capture it. Arguably we, for decades, haven’t done enough in Australia as far as building new dams. I know the Federal Government and state governments have been doing certain things. But we probably need to do more if we’re going to get up to that $100 billion expert level for agriculture, right?

DAVID LITTLEPROUD: We’ve got to be honest, mate. There’s been bugger all done on building dams and plumbing this nation. Since 2003 there’s been 20 dams built in this nation, 16 of those have been in Tasmania. The eastern states have done three fifths of bugger all. I mean, we’ve got $3.5 billion sitting there ready to dig some holes and we can’t get anyone to spend it. We’ve actually got to stand up to these minority groups and say that building these dams is a good thing, not just economically, but it’s a good thing for the environment. If you think about the fact that had our forefathers not built the dams they put in place hundreds of years ago, in fact the Murray Darling would have gone dry. This is the important thing to understand: there would have been an ecological disaster had we not built those dams decades ago and, in fact, we would have seen so much loss of the environment because of the fact that our water would have just run out, instead of holding it and using it, not only for the environment but for farmers.

MICHAEL MCLAREN: And for energy. Now, I spoke yesterday to the Immigration Minister Alex Hawke and I put to him: let’s try to kill two birds with one stone here as we go into 2021. You’ve got all of these British and Irish backpackers around Bronte with the Santa hats on. A lot of people in the government say: let’s get rid of them, send them back to Blackpool. Well, you know as well as I know, we spoke about this earlier in the week, there’s a chronic shortage of backpackers not in Bronte but in the bush, ready to go and pick the harvest that is waiting to be picked. Why don’t we give these people a second chance, say: Listen, we’ll let you stay, we will kick you back if you don’t agree, but we’ll let you stay if you go bush for the next three months and pick fruit where we send you. Why don’t we do that?

DAVID LITTLEPROUD: Well, you’ve taken the words right out of my mouth, and in fact the conversation I had with Alex Hawke was right along those lines: before you kick them out, make them reclassify their status and stay in this country and go and do another 88 days, wipe their slate clean. Because if they do their 88 days in agriculture, they can stay. So, what you need to say is, if they’ve broken the law: you’ve got to go back and do another 88 days in ag, otherwise you can get on the next flight. And I think that’s just a practical, common sense solution to those that might want to flout the law, particularly as we go to New Year’s. And I think that’s just common sense and that’s what we want, and I know Alex is looking into that. Hopefully everyone will do the right thing tonight, but let’s just be honest, this is an opportunity for us to say to those: you can stay, but go and do another 88 days in agriculture, help a few farmers out, make a quid, and you can stay.

MICHAEL MCLAREN: Yeah, fair enough. He seemed receptive to it yesterday, so my fingers are crossed as well. An issue that a lot of people don’t always associate with farming is the Australian dollar, but of course it’s been rising. It’s sitting at something like 76 cents I think, as we speak. Of course, if it ticks over 80 we start to become a bit uncompetitive on the international market. Again, not a lot we can do about that, though, a lot of that’s predicated by international movements.

DAVID LITTLEPROUD: It is, and you’re right, I mean, I remember being a bank Johnny and farmers used to say to me the sweet spot was somewhere around 70 to 75 cents. Because it’s not just what you sell, it’s also the machinery that you buy in. And particularly our broadacre guys are having to bring in big machinery. So around that 70 to 75 cents is about the sweet spot. The fact is that our dollar’s gone up over the past because of the way that we’ve handled our economy. Our economy’s a lot safer and secure than the rest of the world, and that means that our dollar is a lot safer than others, so people start to come towards the Australian dollar. But there’s not a lot we can do about it. We’ve just got to stick to our knitting, make sure we keep the economy strong. And in terms of exports, we still have a great product, whether that’s in the resources or in the agricultural sector, it’s a high-quality product that the world wants, and our job is to make sure there’s diversification of markets so exporters can go into one market if one falters.

MICHAEL MCLAREN: Just finally, one other issue of course that is gaining a bit of traction as the year comes to an end, is the need to pursue a trade deal with India, a bit of a counterbalance to the worsening relationship with China. But, as I said to Matt Canavan yesterday, you’d know all about this because you had to go to India to fight the case, from memory. The Indians aren’t always that trustworthy when it comes to free trade. I remember in 2018 they had a bit of shenanigans around chickpeas, for example, bunged 60 per cent tariffs on that. They may not be the silver bullet. They’re a big market, but are they really one we can do an FTA with?

DAVID LITTLEPROUD: You raise a really good point. You are right, in fact, I got news about an hour after I was sworn in as Agriculture Minister in 2017, so you’ve got as good a memory as me.

MICHAEL MCLAREN: [Laughs]

DAVID LITTLEPROUD: But, you know, there’s 1.6 billion Indians that are prepared to trade with us. Now, whether we get to a free trade agreement is a different point of conjecture. We’ve got market access. Getting a free trade agreement is difficult. Got to understand that more than 50 per cent of the Indian population is employed in agriculture and, for some reason, Indian governments have aversions to free trade agreements, particularly around agriculture, because they believe we can swamp their markets. But the pure arithmetic of this is: that we’re a nation of 25 million people, we produce enough food for 75 million. We have got no hope of flooding an Indian market of 1.6 billion people. But that is a domestic issue that we’ve got to work through, but we do have a strategic relationship with them, which is great, and a stepping stone for us to keep working through. So we will continue to work with that, not just with India, but don’t forget the Middle East and other ASEAN countries, particularly countries like Vietnam, 93 million people on our doorstep who have a very close relationship with us, particularly in terms of trading. So there’s opportunities right around the world and our job is just to diversify and to give the opportunity to send boats left and right if we have trouble with the likes of China, and that’s what we’ve tried to do. We’ve got 13 other free trade agreements other than China and market access into countless other countries. So, we’ll continue to work and India is an opportunity, and we won’t say that it’s not going to happen. But there’s some big challenges there to get it across the line.

MICHAEL MCLAREN: Sure is. Well, happy New Year to you, David, thank you for your time. Let’s hope the rain keeps coming in 2021.

DAVID LITTLEPROUD: Thanks mate, happy New Year to you and all your viewers.