❓ Question regarding state government's response to AACL's proposal for drought relief funding, specifically concerning the combination of exceptional circumstances payments with investment capital. The Minister details meetings and discussions with AACL, the Under Treasurer, and the Federal Minister for Agriculture, emphasizing the need for careful analysis of the proposal.
AnsweredQoN 1142Legislative Council
QuestionView source ↗
AUSTRALIAN AGRICULTURAL CONTRACTS LTD - MANAGING DIRECTOR’S COMMENTS
I refer to recorded comments by Australian Agricultural Contracts Ltd managing director Andrew McBain that he has heard from the state government in some detail on AACL’s proposal to combine a portion of the existing exceptional circumstances payments with investment capital. Given that the federal government agriculture minister Peter Mcgauran reportedly gave a commitment that the AACL proposal and other schemes were priority issues for the coalition that must be dealt with well in advance of next year’s harvest, what are the details of the state’s response referred to by Mr McBain and what state commitments, if any, have been made? Hon KIM CHANCE
I refer to recorded comments by Australian Agricultural Contracts Ltd managing director Andrew McBain that he has heard from the state government in some detail on AACL’s proposal to combine a portion of the existing exceptional circumstances payments with investment capital. Given that the federal government agriculture minister Peter Mcgauran reportedly gave a commitment that the AACL proposal and other schemes were priority issues for the coalition that must be dealt with well in advance of next year’s harvest, what are the details of the state’s response referred to by Mr McBain and what state commitments, if any, have been made? Hon KIM CHANCE
AnswerView source ↗
I thank the member for some notice of this question. Mr McBain’s comments are accurate. I met with Mr McBain and other key members of the Australian Agricultural Contracts Ltd and its affiliate, Macro Funds Ltd, in October. AACL discussed with me a proposal to expand their grain co-production model to farmers affected by the current drought. The grain co-production model provides the farmer with working capital, through AACL, to grow a wheat crop. Their proposal required a substantial investment of public funds to partially mitigate risk where a significant number of farmers are signed up in the same region. The provision of public underwriting would enable AACL to take on more farmers from the same region. Having less diversification in the project pool would not be something AACL would normally contemplate, in that it would unbalance the model and provide higher risk to its investors. The provision of public funds, therefore, is proposed to provide them with a degree of offset to that unbalancing risk. I subsequently discussed the proposal with the state Under Treasurer, having first obviously discussed it with the Treasurer. In that discussion I suggested that he analyse the proposition that has been put to me. I provided all the details that AACL had provided to me. I said that he may also wish to take up the proposal with the federal Under Treasurer, as any such proposal obviously needs to be jointly funded and agreed by commonwealth and state governments. I also had discussion with the federal Minister for Agriculture, Fisheries and Forestry, Peter McGauran, the day after he returned from Morawa. I know that AACL then met separately with the federal minister after my meeting with him. I impressed on the federal minister that although this is perhaps a radically different proposal and would require careful analysis by both federal and state Treasuries, it does potentially provide an opportunity that is otherwise not available. I believe that on that basis it requires very serious and careful assessment, but I acknowledge that it is different and not something that commonwealth and state Treasuries would normally contemplate, particularly given that AACL is at this stage the only provider in Australia of that service, although I hope that there will be other providers. AACL certainly believes that other providers will emerge, including those in the mainstream banking sector. Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
Hon KIM CHANCE replied: I thank the member for some notice of this question. Mr McBain’s comments are accurate. I met with Mr McBain and other key members of the Australian Agricultural Contracts Ltd and its affiliate, Macro Funds Ltd, in October. AACL discussed with me a proposal to expand their grain co-production model to farmers affected by the current drought. The grain co-production model provides the farmer with working capital, through AACL, to grow a wheat crop. Their proposal required a substantial investment of public funds to partially mitigate risk where a significant number of farmers are signed up in the same region. The provision of public underwriting would enable AACL to take on more farmers from the same region. Having less diversification in the project pool would not be something AACL would normally contemplate, in that it would unbalance the model and provide higher risk to its investors. The provision of public funds, therefore, is proposed to provide them with a degree of offset to that unbalancing risk. I subsequently discussed the proposal with the state Under Treasurer, having first obviously discussed it with the Treasurer. In that discussion I suggested that he analyse the proposition that has been put to me. I provided all the details that AACL had provided to me. I said that he may also wish to take up the proposal with the federal Under Treasurer, as any such proposal obviously needs to be jointly funded and agreed by commonwealth and state governments. I also had discussion with the federal Minister for Agriculture, Fisheries and Forestry, Peter McGauran, the day after he returned from Morawa. I know that AACL then met separately with the federal minister after my meeting with him. I impressed on the federal minister that although this is perhaps a radically different proposal and would require careful analysis by both federal and state Treasuries, it does potentially provide an opportunity that is otherwise not available. I believe that on that basis it requires very serious and careful assessment, but I acknowledge that it is different and not something that commonwealth and state Treasuries would normally contemplate, particularly given that AACL is at this stage the only provider in Australia of that service, although I hope that there will be other providers. AACL certainly believes that other providers will emerge, including those in the mainstream banking sector. Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
I thank the member for some notice of this question. Mr McBain’s comments are accurate. I met with Mr McBain and other key members of the Australian Agricultural Contracts Ltd and its affiliate, Macro Funds Ltd, in October. AACL discussed with me a proposal to expand their grain co-production model to farmers affected by the current drought. The grain co-production model provides the farmer with working capital, through AACL, to grow a wheat crop. Their proposal required a substantial investment of public funds to partially mitigate risk where a significant number of farmers are signed up in the same region. The provision of public underwriting would enable AACL to take on more farmers from the same region. Having less diversification in the project pool would not be something AACL would normally contemplate, in that it would unbalance the model and provide higher risk to its investors. The provision of public funds, therefore, is proposed to provide them with a degree of offset to that unbalancing risk. I subsequently discussed the proposal with the state Under Treasurer, having first obviously discussed it with the Treasurer. In that discussion I suggested that he analyse the proposition that has been put to me. I provided all the details that AACL had provided to me. I said that he may also wish to take up the proposal with the federal Under Treasurer, as any such proposal obviously needs to be jointly funded and agreed by commonwealth and state governments. I also had discussion with the federal Minister for Agriculture, Fisheries and Forestry, Peter McGauran, the day after he returned from Morawa. I know that AACL then met separately with the federal minister after my meeting with him. I impressed on the federal minister that although this is perhaps a radically different proposal and would require careful analysis by both federal and state Treasuries, it does potentially provide an opportunity that is otherwise not available. I believe that on that basis it requires very serious and careful assessment, but I acknowledge that it is different and not something that commonwealth and state Treasuries would normally contemplate, particularly given that AACL is at this stage the only provider in Australia of that service, although I hope that there will be other providers. AACL certainly believes that other providers will emerge, including those in the mainstream banking sector. Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
Mr McBain’s comments are accurate. I met with Mr McBain and other key members of the Australian Agricultural Contracts Ltd and its affiliate, Macro Funds Ltd, in October. AACL discussed with me a proposal to expand their grain co-production model to farmers affected by the current drought. The grain co-production model provides the farmer with working capital, through AACL, to grow a wheat crop. Their proposal required a substantial investment of public funds to partially mitigate risk where a significant number of farmers are signed up in the same region. The provision of public underwriting would enable AACL to take on more farmers from the same region. Having less diversification in the project pool would not be something AACL would normally contemplate, in that it would unbalance the model and provide higher risk to its investors. The provision of public funds, therefore, is proposed to provide them with a degree of offset to that unbalancing risk. I subsequently discussed the proposal with the state Under Treasurer, having first obviously discussed it with the Treasurer. In that discussion I suggested that he analyse the proposition that has been put to me. I provided all the details that AACL had provided to me. I said that he may also wish to take up the proposal with the federal Under Treasurer, as any such proposal obviously needs to be jointly funded and agreed by commonwealth and state governments. I also had discussion with the federal Minister for Agriculture, Fisheries and Forestry, Peter McGauran, the day after he returned from Morawa. I know that AACL then met separately with the federal minister after my meeting with him. I impressed on the federal minister that although this is perhaps a radically different proposal and would require careful analysis by both federal and state Treasuries, it does potentially provide an opportunity that is otherwise not available. I believe that on that basis it requires very serious and careful assessment, but I acknowledge that it is different and not something that commonwealth and state Treasuries would normally contemplate, particularly given that AACL is at this stage the only provider in Australia of that service, although I hope that there will be other providers. AACL certainly believes that other providers will emerge, including those in the mainstream banking sector. Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
I subsequently discussed the proposal with the state Under Treasurer, having first obviously discussed it with the Treasurer. In that discussion I suggested that he analyse the proposition that has been put to me. I provided all the details that AACL had provided to me. I said that he may also wish to take up the proposal with the federal Under Treasurer, as any such proposal obviously needs to be jointly funded and agreed by commonwealth and state governments. I also had discussion with the federal Minister for Agriculture, Fisheries and Forestry, Peter McGauran, the day after he returned from Morawa. I know that AACL then met separately with the federal minister after my meeting with him. I impressed on the federal minister that although this is perhaps a radically different proposal and would require careful analysis by both federal and state Treasuries, it does potentially provide an opportunity that is otherwise not available. I believe that on that basis it requires very serious and careful assessment, but I acknowledge that it is different and not something that commonwealth and state Treasuries would normally contemplate, particularly given that AACL is at this stage the only provider in Australia of that service, although I hope that there will be other providers. AACL certainly believes that other providers will emerge, including those in the mainstream banking sector. Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
Hon KIM CHANCE replied: I thank the member for some notice of this question. Mr McBain’s comments are accurate. I met with Mr McBain and other key members of the Australian Agricultural Contracts Ltd and its affiliate, Macro Funds Ltd, in October. AACL discussed with me a proposal to expand their grain co-production model to farmers affected by the current drought. The grain co-production model provides the farmer with working capital, through AACL, to grow a wheat crop. Their proposal required a substantial investment of public funds to partially mitigate risk where a significant number of farmers are signed up in the same region. The provision of public underwriting would enable AACL to take on more farmers from the same region. Having less diversification in the project pool would not be something AACL would normally contemplate, in that it would unbalance the model and provide higher risk to its investors. The provision of public funds, therefore, is proposed to provide them with a degree of offset to that unbalancing risk. I subsequently discussed the proposal with the state Under Treasurer, having first obviously discussed it with the Treasurer. In that discussion I suggested that he analyse the proposition that has been put to me. I provided all the details that AACL had provided to me. I said that he may also wish to take up the proposal with the federal Under Treasurer, as any such proposal obviously needs to be jointly funded and agreed by commonwealth and state governments. I also had discussion with the federal Minister for Agriculture, Fisheries and Forestry, Peter McGauran, the day after he returned from Morawa. I know that AACL then met separately with the federal minister after my meeting with him. I impressed on the federal minister that although this is perhaps a radically different proposal and would require careful analysis by both federal and state Treasuries, it does potentially provide an opportunity that is otherwise not available. I believe that on that basis it requires very serious and careful assessment, but I acknowledge that it is different and not something that commonwealth and state Treasuries would normally contemplate, particularly given that AACL is at this stage the only provider in Australia of that service, although I hope that there will be other providers. AACL certainly believes that other providers will emerge, including those in the mainstream banking sector. Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
I thank the member for some notice of this question. Mr McBain’s comments are accurate. I met with Mr McBain and other key members of the Australian Agricultural Contracts Ltd and its affiliate, Macro Funds Ltd, in October. AACL discussed with me a proposal to expand their grain co-production model to farmers affected by the current drought. The grain co-production model provides the farmer with working capital, through AACL, to grow a wheat crop. Their proposal required a substantial investment of public funds to partially mitigate risk where a significant number of farmers are signed up in the same region. The provision of public underwriting would enable AACL to take on more farmers from the same region. Having less diversification in the project pool would not be something AACL would normally contemplate, in that it would unbalance the model and provide higher risk to its investors. The provision of public funds, therefore, is proposed to provide them with a degree of offset to that unbalancing risk. I subsequently discussed the proposal with the state Under Treasurer, having first obviously discussed it with the Treasurer. In that discussion I suggested that he analyse the proposition that has been put to me. I provided all the details that AACL had provided to me. I said that he may also wish to take up the proposal with the federal Under Treasurer, as any such proposal obviously needs to be jointly funded and agreed by commonwealth and state governments. I also had discussion with the federal Minister for Agriculture, Fisheries and Forestry, Peter McGauran, the day after he returned from Morawa. I know that AACL then met separately with the federal minister after my meeting with him. I impressed on the federal minister that although this is perhaps a radically different proposal and would require careful analysis by both federal and state Treasuries, it does potentially provide an opportunity that is otherwise not available. I believe that on that basis it requires very serious and careful assessment, but I acknowledge that it is different and not something that commonwealth and state Treasuries would normally contemplate, particularly given that AACL is at this stage the only provider in Australia of that service, although I hope that there will be other providers. AACL certainly believes that other providers will emerge, including those in the mainstream banking sector. Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
Mr McBain’s comments are accurate. I met with Mr McBain and other key members of the Australian Agricultural Contracts Ltd and its affiliate, Macro Funds Ltd, in October. AACL discussed with me a proposal to expand their grain co-production model to farmers affected by the current drought. The grain co-production model provides the farmer with working capital, through AACL, to grow a wheat crop. Their proposal required a substantial investment of public funds to partially mitigate risk where a significant number of farmers are signed up in the same region. The provision of public underwriting would enable AACL to take on more farmers from the same region. Having less diversification in the project pool would not be something AACL would normally contemplate, in that it would unbalance the model and provide higher risk to its investors. The provision of public funds, therefore, is proposed to provide them with a degree of offset to that unbalancing risk. I subsequently discussed the proposal with the state Under Treasurer, having first obviously discussed it with the Treasurer. In that discussion I suggested that he analyse the proposition that has been put to me. I provided all the details that AACL had provided to me. I said that he may also wish to take up the proposal with the federal Under Treasurer, as any such proposal obviously needs to be jointly funded and agreed by commonwealth and state governments. I also had discussion with the federal Minister for Agriculture, Fisheries and Forestry, Peter McGauran, the day after he returned from Morawa. I know that AACL then met separately with the federal minister after my meeting with him. I impressed on the federal minister that although this is perhaps a radically different proposal and would require careful analysis by both federal and state Treasuries, it does potentially provide an opportunity that is otherwise not available. I believe that on that basis it requires very serious and careful assessment, but I acknowledge that it is different and not something that commonwealth and state Treasuries would normally contemplate, particularly given that AACL is at this stage the only provider in Australia of that service, although I hope that there will be other providers. AACL certainly believes that other providers will emerge, including those in the mainstream banking sector. Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
I subsequently discussed the proposal with the state Under Treasurer, having first obviously discussed it with the Treasurer. In that discussion I suggested that he analyse the proposition that has been put to me. I provided all the details that AACL had provided to me. I said that he may also wish to take up the proposal with the federal Under Treasurer, as any such proposal obviously needs to be jointly funded and agreed by commonwealth and state governments. I also had discussion with the federal Minister for Agriculture, Fisheries and Forestry, Peter McGauran, the day after he returned from Morawa. I know that AACL then met separately with the federal minister after my meeting with him. I impressed on the federal minister that although this is perhaps a radically different proposal and would require careful analysis by both federal and state Treasuries, it does potentially provide an opportunity that is otherwise not available. I believe that on that basis it requires very serious and careful assessment, but I acknowledge that it is different and not something that commonwealth and state Treasuries would normally contemplate, particularly given that AACL is at this stage the only provider in Australia of that service, although I hope that there will be other providers. AACL certainly believes that other providers will emerge, including those in the mainstream banking sector. Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
Beyond that, I think we must wait for the dust of the federal election to settle. I am keen to try to ensure that discussion does happen at that Treasury level and that ultimately governments of both commonwealth and the states will be able to gain confidence in the model.
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