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The upgrading of roads and water infrastructure have been nominated by farmers and regional powerbrokers as priorities for a promised $200 million State Government fund to boost Victoria’s agricultural sector.

The money has been promised from the proceeds of the government’s planned “privatisation” of the Port of Melbourne, to be set aside for a so-called Agriculture Infrastructure and Jobs Fund.

However, the new fund could yet be stillborn because of Opposition moves to block the long-term leasing of the port in parliament. It objects to a clause in the legislation that would force the state to pay compensation to the lessee should an additional port servicing Melbourne be built during the 50-year lease.

The lagging maintenance of country roads has been criticised by the mayors of regional towns as well as farmers, concerned that their poor condition is hampering farm productivity.

Mildura mayor Glenn Milne said works on country roads urgently needed to be addressed.

“We have got a need for upgrades on our roads, particularly the Calder Highway,” he told The Citizen. “I mean, it’s in urgent need of some dollars . . . because it’s really in not much of a condition.”

Ash Marshall, who runs a broadacre farm in the Mallee, echoed the sentiment. “I think roads are a huge thing for us. A lot of our freight goes on roads and, even local roads, they’re terrible,” he said.

Mr Marshall added that it was important to upgrade country roads within a 200-kilometre radius of Melbourne as goods produced within that distance of the capital would usually be transported by road rather than rail.

Road funding, in fact, has long been a source of contention. The Minister for Roads, Luke Donnellan, has claimed that funds were cut by more than $30 million under the Napthine Government.

“I think roads are a huge thing for us. A lot of our freight goes on roads and, even local roads, they’re terrible.” — Mallee farmer Ash Marshall

The new Agriculture Infrastructure and Jobs Fund follows a recent pledge by the Andrews Government to spend $135.6 million to repair deteriorating roads across Victoria, including an $80 million investment for road resurfacing under the Road Surface Replacement Program. The new fund is designed to focus on key freight routes such as the Princes Freeway to be able to accommodate heavier vehicles and boost productivity.

But the bush says its needs extend beyond roads, with the upgrading of water infrastructure such as irrigation systems also a priority, as severe dry conditions continue to grip regions including the Wimmera.

David Jochinke, the vice-president of the Victorian Famers Federation, said water scarcity had become a key issue in dry regions of the state over the last decade.

“[Measures] would involve water piping for livestock to ensure that in times of dry, when farmers’ rain-fed dams run low, they can access that water throughout the year. Then, also, for irrigation infrastructure in areas that aren’t covered by the Murray-Darling Basin,” he said.

In 2010, the Wimmera Mallee Pipeline Project was completed, which replaced open ground channels with pipes to save water. Despite this, recent drought-like conditions were putting renewed strain on farmers.

Swan Hill’s mayor, Michael Adamson, lamented the lack of funding for rural Victoria generally. “We are actually funding the future development of the Port of Melbourne because the produce that we make will be directly exported through it,” he said.

Mr Adamson said the proposed fund should be used to assist getting the agricultural products grown in his region to market to be sold.

The Minister for Agriculture, Jaala Pulford, said money from the proposed regional fund would go directly to farms as well as to key government authorities, such as water utilities, in an effort to get projects under way.

“The Agriculture Infrastructure and Jobs Fund is about supporting a particular project that will boost access to market and productivity in agriculture,” she told The Citizen.

However, the Nationals MP for Northern Victoria, Damian Drum, said the $200 million was an insufficient amount and claimed the government had been “shamed” into setting up the fund only after protests from the Opposition.

“Probably over half of all the produce within the containers that go through the port are generated in the regions, yet initially zero dollars from the Labor Party were going back to the regions,” he said. 

Sceptical of the government’s commitment to rural Victoria, Mr Drum suggested that money might be syphoned off to fix roads around the port in Melbourne. But Ms Pulford rejected the claim, saying: “Mr Drum is talking out of his hat.”

Mr Drum said the stalling of the port lease was not so much the result of a political stalemate as it was a case of legislative and regulatory hold-ups. “The evidence would suggest that the Labor Government is going to have to do away with the compensation clause for competitors,” he said.

The government wants to lease the Port of Melbourne in order to fund its $6 billion signature policy of removing 50 level rail crossings throughout suburban Melbourne. A lease, as opposed to a sale, would ensure that the underlying land and any improvements would be handed back to the public once the lease expires.

Unlike in other states, the Port of Melbourne enjoys a monopoly because there are no major competing ports in Victoria. In response to concerns from the Australian Competition and Consumer Commission, Treasurer Tim Pallas has said that the Essential Services Commission would conduct regular reviews of whether the port’s prospective leaseholders were abusing this monopolistic position. 

But ACCC chairman Rod Sims recently told Fairfax Media: “It is not a good look to be selling an asset and providing compensation if a competitor sets up shop when, of course, it is the government who can decide whether or not the competitor gets the go-ahead. It is a signal against competition, rather than the competition we should be seeking to create.”

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