Friday, June 28, 2013

ABA Takes Lead on Cattle Industry Reform for the Future Whilst CCA Dithers in the Past

Cattle Council Meets with Minister on Restructure Article can be viewed here
ABA Looks to the Future Article can be viewed here
Beef - The Future Forum advertisement can be viewed here


The Australian Beef Association (ABA) has assumed leadership in the cattle industry reform debate by convening an all inclusive Beef-the Future Forum to discuss solutions to the current cattle industry crisis at the Roma Show Ground on 10 July 2013 whilst the Cattle Council (CCA) dithers on its back to the future restructure process that it launched over eighteen months ago.


Whilst the CCA is to be congratulated on the industry inclusive approach that it has taken on its reform deliberations, the saga of CCA’s navel gazing restructure process which began at the MLA AGM in Longreach in November 2011 has dragged on and on with CCA:
·                 first rejecting the direct election alternative for the CCA Board and pushing for a hybrid model of eight CCA directors nominated by the State Farmer Organisations (SFO’s) and four directly elected directors, a proposition which by:
·                 November 2012 had morphed into a proposal for a fifteen member CCA board with seven seats allocated to SFO representatives and eight seats to independently directly elected board members, which by:
·                 June 2013 has transmogrified into a proposal for a dysfunctional undemocratically elected twenty five member CCA board with eleven SFO board seats, eight board members independently elected by levy payers and six board seats reserved for first in, best dressed “buy a board seat” Corporates.

The CCA has admitted that its current $1.3M budget (which has not grown in more than ten years) and full time staff of five is insufficient to allow the CCA to fulfill its policy setting and MLA’s supervisory role. 

The CCA now proposes to rectify its funding and staffing crisis by diverting $0.38 from the grassfed $5/hd MLA transaction levy to the CCA through a rather shabby “Opt Out” right for those levy payers who do not want to divert their levy $’s to prop up the CCA and the current cattle industry structures. 

The “Opt Out” CCA grab for MLA levies is contrary to the Government’s 12 Levy Principles and Guidelines which comprises amongst other things a provision that levy imposition be equitable between levy payers and didn’t have the support of the outgoing Federal Minister for Agriculture Joe Ludwig and does not appear to have the support of the Shadow Minister for Agriculture John Cobb who was reported in this week’s attached Beef Central article as saying that a compulsory CCA MLA levy grab was not going to happen.

Beef – The Future Forum

ABA have shown real leadership by stepping into this backward looking policy morass by convening its Beef- the Future Forum in Roma on 10 July 2013 which the attached 19 July 2013 Beef Central article entitled “ABA Looks to the Future with July Roma Forum” and the attached ABA Rural Press advertisement say will focus on cattle industry restructure options, the skyrocketing rural debt crisis, and the disproportionate retail share of the cattle dollar.

The ABA have foreshadowed an open meeting format for the Roma Forum with CCA’s CEO Jed Metz and CCA President Andrew Ogilvie first presenting the CCA’s restructure proposals with the ABA then presenting its own reforms for the future which includes a Cattle Corporation with a board directly elected by levy paying producers receiving and controling the expenditure of all of the grassfed cattle transaction levies. 

The ABA will also encourage input and proposals from the floor at the July 2013 Roma Beef-the Future Forum.

The Roma Beef – The Future Forum will provide an ideal platform for the CCA to obtain grass roots input into their reform proposals and both ABA and CCA are to be congratulated on their on their joint consultative attempts to find solutions to the problems currently besetting the cattle industry.

AMPG Reform Proposals

Previous editions of the HuntBlog Newsletter have outlined cattle industry reform proposals put forward by the Australian Meat Producers Group (AMPG) “think tank” whose membership included some of Australia’s largest and most influential cattle industry figures, formed after the widely attended 2010 Beef Industry Forums in Armidale and Paradise Lagoon at Rockhampton.  

The AMPG identified the following four key flaws in the current industry structures:
1.               the dysfunctional divide between policy setting and policy delivery; and

2.               the CCA’s inability to obtain adequate funding to carry out its charter; and

3.               confusion under the current organisational structures by both Government and     industry about who speaks for the cattle industry; and

           4.               the perception by many grass roots levy payers that they are disenfranchised under the current system.

The AMPG has suggested the following solutions to address these issues
·             combining the Cattle Council policy setting role with the MLA service provider role under one roof to ensure the seamless delivery of policy and a well funded peak council to interact with government;
·             in other words, instead of having the MLA as the service provider for the cattle industry with CCA as the overseeing policy setter, bring the two functions together in one body to create a similar policy setting and service delivery structure to those found in the egg and pork industries;
·             a combined CCA/MLA cattle producer Cattle Corporation of Australia would (initially at least) receive the best part of $56M a year in grass fed cattle producer levies plus approximately $8M in lot fed levies;
·             the board of the proposed new combined policy setting and delivery Cattle Corporation would be elected through a dual register voting system to balance the interests of both the large and small cattle producers;
·             each voting register would elect half of the new Cattle Corporation’s board members;
·             with one register carrying ‘one-man, one-vote’ and the other based on the amount of levies paid, with every levy payer entitled to vote in both registers similar to the Australian Meat Processor Corporation (AMPC) two register voting system;
·             the dual register voting system would ensure that the little producers who outnumber the big would not be able to dictate how the levies were spent while simultaneously stopping the smaller number of big players having a disproportionate impact on the outcome;
·             the proposed AMPG two tiered voting structure would also "self manage" the perceived need for north and south regional representation on the board of the new corporation with the large population of smaller producers in the south dominating the ‘one-man, one-vote’ register and northern producers with greater herd sizes (and hence greater levy payments) dominating the register based on the amount of levies paid;

Previous Reform Forums

In 2004 over a 1,200 cattle producers attended a Beef Industry Forum in Roma convened by the ABA and JR McDonald from Bindaree Beef to discuss the industry issues then facing the cattle industry and in 2010 over 1,000 cattle producers attended another rally convened by JR McDonald from Bindaree Beef at Armidale in Northern NSW which was followed by the highly successful rally held by Graeme Acton and the United Beef Group at Paradise Lagoon, Rockhampton in July 2010 which was attended by over 500 Northern Cattle Producers.

It is common ground that the cattle industry is now in a much worse state than it was in either 2004 or 2010 with real cattle prices having fallen by over 40% in the last decade despite the $2 billion that has been spent by the MLA since its inception in 1998.

Nine years have now passed since the first 2004 Industry Restructure Forum at Roma and three years have passed since the Beef’s New Direction Forums in Armidale and Rockhampton in 2010 and despite the assurances from the CCA and MLA that levy payers money was being well spent and CCA and MLA’s patronising predictions of a bright cattle industry future under their stewardship, the cattle industry is now suffering its worst crisis since the 1970s.

Cattle Producers Attendance at the Roma Beef – The Future Forum on 10 July 2013

Every levy payer who attended the Roma Forum in 2004 and the Armidale and Rockhampton Forums in 2010 and anyone else who is concerned about the future of the cattle industry and the reforms that need to be put into place to meet the needs of the cattle industry in the next decade should make sure they attend the ABA’s Beef-the Future Forum in Roma on 10 July 2013 so that they can have their say. 

ABA’s 10 July 2013 Roma Beef-the Future Forum could prove to be a ground breaking meeting that sets the foundation for the immediate future of the cattle industry. 

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