Labor to vote with One Nation to pressure Nationals over dairy prices

Sarah Martin
Photograph: Mike Bowers/The Guardian

Labor will join with One Nation to pressure the government over dairy prices, saying Nationals MPs will be forced to choose whether to cross the floor in support of “desperate dairy farmers”.

The shadow agriculture minister, Joel Fitzgibbon, said on Wednesday that Labor would vote with One Nation in the Senate when parliament returned next week to bring on debate of Pauline Hanson’s dairy industry bill.

The move comes as the junior coalition partner fractures over the government’s proposed new dairy code of conduct, with the agriculture minister, Bridget McKenzie, under pressure from colleagues over delays to the new code.

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One Nationals MP, the member for Lyne, David Gillespie, has said he does not support the government’s proposal, calling it “vague, ambiguous and not protecting farmers from the inadequacies of the current system”.

McKenzie faced the prospect of a spill motion last month after Hanson claimed credit for the government’s decision to bring forward the proposed code, which she had told colleagues would not be feasible until next year.

Fitzgibbon said the Hanson bill would apply the necessary pressure on the prime minister, Scott Morrison, to support struggling dairy farmers and to accelerate the implementation of an effective mandatory code of conduct to address market power imbalance, saying the Coalition will have “nowhere to hide”.

Labor said the bill was largely consistent with its election policy to task the Australian Consumer and Competition Commission with assessing and testing the efficacy of a minimum farmgate milk price and to make recommendations on the best design options.

“For too long our dairy farmers have been caught in a cost-price squeeze and their plight has now been compounded by the shocking drought,” Fitzgibbon said.

“The retail price of milk remains stubbornly low while farm input costs continue to grow. Tough talk by ministers about the big supermarket chains have proven weak, hollow and ineffective. If the government won’t move to help our farmers, Labor and the crossbench will.

“Next week we’ll give National party senators the chance to finally support our desperate dairy farmers.”

Hanson’s protecting Australian dairy bill amends the Competition and Consumer Act 2010 to require the ACCC to determine a base minimum price for milk for each dairy season and require the minister to refer to the Productivity Commission for inquiry the effectiveness of determining a base price for milk.

It would also look at the potential effectiveness of a divestiture regime for the dairy industry, and would establish a mandatory industry code for the food and grocery industry, including the dairy industry.

The government established an inquiry into the dairy industry by the ACCC in October 2016, with the final report released in April last year.

One of the key recommendations of the inquiry was for a mandatory code of conduct, saying it would improve contracting practices between dairy processors and farmers, and address problems arising from “the large imbalance” in bargaining power that exists between dairy farmers and processors.

But the government has rejected key elements of the Hanson bill, with the Nationals MP David Littleproud calling minimum gate prices a “cruel hoax”.

Morrison has dismissed Hanson’s push for a new inquiry, saying his focus was on the new code of conduct.

On Wednesday, Liberal MP Tony Pasin said the re-regulation of the industry was not what dairy farmers wanted, calling the Hanson move “populist politics”.