Budget 2022-23: What’s in it for agriculture

The new Federal Government, led by Prime Minister Anthony Albanese, handed down its first budget on Tuesday night, October 25, reflecting spending cuts and redirections to areas the Government deemed crucial such as housing affordability and infrastructure.

Treasurer Jim Chalmers deemed the recent Budget “responsible, right for the times and begins to build a better future for Australia” in the face of increasing cost of living pressures and inflation, ongoing global turmoil and declining real wages.

Unfortunately, that meant slashes to funding in the agricultural and rural sector as well, including a cut to trade show support and the abolishment of the Ag Worker Visa put forward by the Morrison Government.

Here are some of the key Budget measures aimed at the regional and agriculture sectors.

In response to increasing threats to Australia’s biosecurity system such as foot-and-mouth disease (FMD) and lumpy skin disease (LSD), the Federal Government is pledging $134.1 million to boost the system and continue keeping pests and diseases at bay.

The biosecurity package includes programs both to boost frontline capability and support Indonesia to manage FMD and LSD, by fast-tracking $61.6 million in funding over the next two years.

A cool $46.7 million, double that of the previous Budget, has been earmarked to support continuous improvement in livestock traceability systems to effectively manage emerging risks.

The Government has also committed to its election promise to provide an additional 20 biosecurity detector dogs and handlers, to be deployed in airports and mail centres around Australia.

As promised by Labor before it took office, the Government is establishing a National Reconstruction Fund to provide $15 billion towards strengthening priority industries including agriculture, transport, medical science, renewables and more. Of that, $500 million has been earmarked for the agriculture industry over seven years.

Some of the fund will go towards expanding the domestic and export market, create more job opportunities, and overall support for regional businesses within the sector.

The Government is committing to a $2.4 billion investment in NBN Co that it hopes will extend fibre access to 1.5 million more premises, including over 660,000 homes in regional Australia.

It is also offering a year of free broadband for up to 30,000 unconnected families to help students access learning materials from home.

A further $1.2 billion is poured into the Better Connectivity for Regional and Rural Australia Plan to enhance connectivity.

The Government is pledging $20.8 million for improved planning, tools and systems to help prepare for drought, which is not covered through natural disaster or emergency management funds.

The funds will support drought policy development for another two years while the next Australian Government Drought Plan and National Drought Agreement are finalised.

Some of the funding will also go towards implementing a Drought Early Warning System and a new decision-making framework to support more consistent, timely Government decisions on intervention and support for individuals and communities during drought.

Previously announced trade show grants have been cut short and replaced with funding for specific and larger events such as Casino Beef Week and Hort Connections.

The Budget delivers $12.3 million to support the following shows: Beef Australia, Casino Beef Week, Lambex, Hort Connections, AgriTech Industry Awards, EvokeAG and the 2nd Dairy Symposium.

The budget provides $4 million over four years to establish an Inspector-General of Animal Welfare by expanding the functions of the Office of the Inspector-General of Live Animal Exports to include additional animal welfare related objectives and expertise.

One key ag policy that Labor famously axed is the Ag Visa, and has in this Budget somewhat replaced it with the PALM (Pacific Australia Labour Mobility) scheme.

The PALM scheme is not ag specific, and involves 10 countries including Fiji, Kiribati, Nauru, Papua New Guinea, Samoa, Solomon Islands, Timor-Leste, Tonga, Tuvalu and Vanuatu.

Under the scheme, eligible Australian businesses can hire workers from the countries involved in the scheme to fill worker shortages, an issue infamously plaguing the agriculture sector.

The scheme has also been adjusted to absorb some of the features of the axed ag visa including allowing more businesses in the agricultural supply chain to recruit PALM scheme workers.

However, according to the National Farmers Federation, the PALM scheme does not deliver enough for the farm sector.

The Budget reveals that Labor’s election commitment to cover worker travel costs under the Pacific Australia Labour Mobility (PALM) Scheme will instead be replaced with an underwriting scheme.

"This commitment to help with the cost of bringing in Pacific workers was a consolation prize for the scrapping of the Ag Visa,” said NFF President, Fiona Simson.

"Now it becomes the latest in a series of bitter blows and disappointments for farmers pleading for an end to this crisis.

"As the workforce crisis drags on, farmers are making the difficult decision to scale back production or leave the industry entirely – leaving Australia more vulnerable to price and supply shocks.”

The Budget is providing $1.1 billion over six years to extend funding for the Natural Heritage Trust to support sustainable management of Australia’s environment, with $302.1 million earmarked for the farm sector.

The funding will go towards supporting farming practices that reduce emissions, improving on-farm biodiversity and more that supports an overall goal of making farming more sustainable.  

Agriculture is one of many sectors in dire need of more workers, and the Federal Government, alongside all states and territories, are planning to address that by pouring $1 billion in a one-year National Skills Agreement.

The agreement will commence on January 1, 2023, and deliver 180,000 fee-free TAFE and community-based vocational education places throughout 2023.

While the interim agreement operates throughout 2023, the Government and all states and territories will work together to improve the VET sector, including by delivering a further 300,000 fee-free places from 2024.

Some of the sectors targeted in this initiative include the aged care sector, education, technology, hospitality, construction, agriculture, manufacturing and defense.  

In addition, the Government is also committed to provide up to 20,000 additional university places for people from under-represented backgrounds such as those from regional areas and First Nations Australians, offering everyone an opportunity to obtain higher education.

The additional places will be allocated over two years from the start of 2023 and will be targeted at areas of skills shortage like education, health, engineering, and technology.

The Government is committing $1 billion for two new flagship programs designed to drive regional development.

Community groups and local councils in regional and rural areas will be invited to seek support from the new Growing Regions Program, which will fund local infrastructure projects such as libraries and regional airport upgrades.

Through its new regional Precincts and Partnerships Program, the Government will work with states and local councils to invest in place-based projects that transform regional centres.

"The Precincts and Partnerships Fund moves towards a model of smart, place-based investment championed by the NFF,” Simson said.

"It’s fantastic to see the Government leading the way to a more strategic and collaborative approach to regional development.

"Unfortunately, the quantum of funds will disappoint regional Australians, as new programs fail to fill the void left by cuts. While more Australians are heading to the regions, it seems government investment is heading in the other direction."

In the wake of the Budget, the NFF is calling on the Government to increase its focus on food supply issues.

"While this Budget delivers on fantastic election commitments in areas like connectivity, it is also wanting when it comes to some of agriculture’s greatest challenges," Simson said. 

"Farmers are in the grip of a severe labour crisis, facing skyrocketing costs, and currently experiencing flooding – in some cases for the third time in 12 months.

"These pressures on farmers are being felt by everyday Australians who are witnessing supply and price shocks on supermarket shelves.

"We can’t turn a blind eye to the pressure this is putting on household budgets. There are steps the Government can and should take to boost output and ease supply and cost issues. Things like improving access to labour, bolstering supply chain infrastructure, and securing our access to water.

"This is clearly a transitional budget and we anticipate further measures in the next, more traditional May budget."

Budget 2022: What’s in it for agriculture and farm businesses

Budget 2021: What’s in it for farmers and ag