Calls to halve cattle duty: $40m in bloated comp fund

Farmers calls to halve the cattle transition duty from $5 have been ignored by Victorian Agriculture Minister Ros Spence.

Agriculture Minister Ros Spence is accused of sitting on her hands, ignoring advice to halve the transaction duties cattle producers pay into a $40m fund.

Victorian Agriculture Minister Ros Spence has been accused of “sitting on her hands”, ignoring calls to cut the maximum cattle transaction duty producers pay on each animal from $5 to $2.50.

The Cattle Compensation Fund, into which producers are pumping $4m to $6m in transaction duties each year, has grown from $19m in 2015 to $40m today.

Meanwhile Victoria’s revolving door of agriculture ministers have approved withdrawals of just $2m to $2.3m a year to cover Agriculture Victoria and cattle industry projects that focus on disease research and biosecurity, plus subsidising electronic ID tags.

Key stakeholders familiar with the fund’s operation said Ms Spence had been advised to halve the $5 maximum duty on cattle and simplify the scheme, which currently uses a complex variety of rates that add to compliance costs.

The stakeholders said that to date Minister Spence had ignored the advice and was just “sitting on her hands”, refusing to seek industry feedback.

When Ms Spence was asked what action she was taking, the minister’s office said “any change to duties would need to carefully consider the potential impacts on farmers and future risk of disease to livestock”.

Many producers believe the fund is needed to compensate for the loss or destruction of cattle in the wake of a major disease outbreak, such as foot and mouth disease.

But other states and territories operate without feeding transaction duties into livestock compensation funds, relying instead on Australia’s emergency animal disease response agreements with the federal government.

Under the EADs the federal government has agreed to cover all response costs in the wake of a disease outbreak such as FMD, whether in Victoria or any other state, with industry repaying 20 per cent of that amount over 10 years.

One industry stakeholder said not one cent of Victoria’s fund had been spent on compensating for the loss of livestock.

VFF Livestock president Scott Young said the issue of cutting the transaction duty would “definitely be something we’d be interested in” and urged Agriculture Victoria to seek feedback from producers.

“Obviously as farmers we’re all looking at minimising costs,” Mr Young said.

One industry stakeholder said all the VFF needed to do was write a letter of support to the minister asking for the duty to be cut.