corrected version
OUTER SUBURBAN/INTERFACE SERVICES AND DEVELOPMENT COMMITTEE
Inquiry into sustainable development of agribusiness in outer suburban Melbourne
Melbourne—19 May 2009
Members
MrG. Seitz / MrK. SmithMrM. Guy / Ms C. Hartland
MrD. Nardella
MrD. Hodgett / MrD. Nardella
Chair: MrG. Seitz
Deputy Chair: MrK. Smith
Staff
Executive Officer: MrS. ColeyResearch Officer: MrK. Delaney
Committee Administrative Officer: Ms N-M. Holmes
Witnesses
Mayor Michael Tudball, andMr Robert Dobrzynski, Chief Executive Officer,
Moorabool Shire Council.
Mayor Tudball and MrDobrzynski were sworn in.
TheCHAIR—Good morning. This is a public hearing and all witnesses will either have to take the oath or affirmation because all evidence we take is on that basis which will afford you the parliamentary privilege and the protection of the Parliamentary Committees Act and the Constitution Act, so whatever you say in here cannot be held against you. However, if you say it outside, that is a different matter. That is the procedure, and I will repeat it if other people come in later on, but so that most of you understand it now, all the proceedings are taped by Hansard here and will be typed up. In due course you will get a copy of what you have said so I will require your mailing address and names quite clearly so that we can send it to you and ensure you get a copy of Hansard to proofread it and check it.
Having said that, there is an apology, a couple of my colleagues are running late. David Hodgett is 10minutes away and I think Don Nardella is somewhere floating around, I am told he is supposed to be here. Without further ado I will ask Councillor Michael Tudball from Moorabool Shire to address us.
MayorTUDBALL—MrChairman, welcome to you and your committee to Moorabool Shire. Thank you for choosing us, or us offering up Moorabool, whichever way it came about. We do appreciate you coming out to Moorabool on a beautiful day and in the heart of Moorabool here in Ballan. Can I also acknowledge some of the presenters that we have here today that will talk about the importance of agribusiness to Moorabool Shire. We have representatives from the Bacchus Marsh area and market gardening, the dryland farming to the south, and also the broadacre farming to the south-west of our municipality. We have a great range here today to tell you how important agribusiness is to places like Moorabool. I would also stress the importance of your committee, and Moorabool has presented to most of the iterations you have had of the Outer Suburban/Interface Services and Development Committee and its various iterations; the importance of the peri-urban region, like Moorabool Shire, Bacchus Marsh and Ballan and our growth area of Gordon.
The periurbans play a very important part, and your committee recognised that in one of the earlier reports, referring to the periurbans separately to the outer suburban areas of the Meltons etcetera and what an important role we play in the whole scheme of things, particularly in agribusiness, and you will hear from the presenters later on today and from Moorabool Shire's own presentation, our proximity to the major areas—to the ports, to the wharves, to the markets etcetera—ideally places Moorabool Shire to provide these things. We have many challenges that you will also hear today, MrChairman, that confront us, not the least of which is access to water. It is a huge issue for us. We also have our colleagues from Western Water here that will also talk about it. We deal very closely with our water authorities, the catchment management authorities, Southern Rural Water, and of course Western Water and Central Highlands Water.
It is critical to us. You will hear the dire straits we are in, in the area, because of drought and climate change, and it does not help us that we are in a rain shadow at the best of times. When we are in drought it is an even bigger rain shadow for us. You will hear about that today, particularly about food security and water security. These guys need some confidence to carry on the business. It is a big economic driver to Moorabool Shire and, Robert, our chief executive officer, will talk in detail about how much of an economic driver it is and what we need to progress that. In closing, thank you for coming out to Moorabool Shire. I cannot be with you all day but the tour will be very informative for you this afternoon, particularly around some of the areas. I understand that there are gumboots and shovels ready to go for you to get you into some work while we are down there as well, and Frank Ruffo from Tripod Farmers will show you a significant industry we have in Bacchus Marsh but some of the threats that face us. Thank you again, MrChairman.
TheCHAIR—Thank you, Michael. Since you will not be with us all day I will express on behalf of the committee your hospitality, your organisation and making your chamber available. Now, we have Robert Dobrzynski, the CEO, to address us. You have about 20 minutes or a bit less than that. Leave us a bit of time at the end for questions and interaction with the committee members here. May I have your mailing address.
MrDOBRZYNSKI—Thank you, MrChairman. Thank you for the opportunity to address the committee. My mail address is 18 Augusta Place, Bacchus Marsh, or via the council. Both will find me. I would first like to comment on the Melbourne periurban region which Moorabool Shire has had a significant part to play in galvanising into a unit and then turn more specifically to comment on Moorabool Shire. The periurban group of rural councils which I understand is a major part of the terms of reference of the committee comprises seven councils with a total population in excess of 209,000 people. Essentially, it is all the councils that surround the Melbourne metropolitan area boundary and includes Moorabool, Murrindindi Shire, Baw Baw Shire, Bass Coast Shire, Macedon Shire, Mitchell Shire and Surf Coast Shire.
One of the reasons that Moorabool was keen to establish a periurban of rural councils was because it was felt that there was a vacuum in terms of a state government vision for the periurban. It was ill defined and inconsistently applied. There was the Melbourne 2030 strategy and in some cases there was a regional strategy based on regional centres, such as Bendigo and Ballarat. In our case we are still waiting for that regional strategy but there appeared to be very little in terms of the areas in between the periurban which are experiencing population growth far in excess of the state average and far in excess particularly of the provincial Victorian average.
The councils that form the group felt that there was a risk that if we did not act in concert that there would be ill considered outcomes that could compromise state priorities and there was an urgent need for us to accommodate the rapid population growth that was occurring and the subsequent need for infrastructure that was taxing our rate bases and also to retain high value land in agriculture, and increasingly we are seeing traditional agricultural pursuits being challenged, particularly by hobby farmers which tend to push up land prices and exacerbate fragmentation.
The periurban of rural councils receive significant funding from Sustainability Victoria to undertake probably the most authoritative and comprehensive research paper, Planning Sustainable Futures for Melbourne's Periurban Region. It was undertaken through the auspice of Michael Buxton at RMIT and is really the first comprehensive look at the periurban. MrChairman, in terms of your committee's brief it goes into a great deal of detail in terms of agricultural trends and change, land development trends, water resources, socioeconomic trends, biodiversity and native vegetation. There is a great deal of science in here and we hope to work collaboratively with the state government to undertake some policy changes that reflect the challenges that are in that document.
Agricultural activity remains significant in the periurban area contributing over fivepercent or $390million of Victoria's $7.5 billion farm business output in 2006. This is an increase on previous years, so the periurban is becoming more relevant. The region's agricultural productivity is dominated by small-scale grazing, most of which is likely to be supported by off-farm income, along with some notable exceptions where there are examples of large-scale intensive activity and adaptive niche production.
Overheads shown.
MrDOBRZYNSKI—The number and proportion of farms within the various EVAO ranges indicate that many small farm businesses are a dominant feature of the landscape in the periurban. However, the data in the report also indicates that in terms of farm business output, larger farm businesses remain extremely significant. In general, the overall contribution of larger businesses is significantly greater than their population. The average regional EVAO for all farms was $157,613, and for farms with an EVAO of less than $100,000, it was $36,450 which obviously leads to a significant importance of off-farm income to retain those farms in agricultural production. For farms with an EVAO of over $1 million, it was over $3million.
I have left copies of this presentation, MrChairman, with your staff that includes these graphs, and I also have a number of CDs of the periurban report which I will leave you that goes in greater detail on some of the information I am presenting.
Within the region, Macedon Ranges Shire, which has experienced the highest levels of rural land development, has the highest proportion of low—that is below $100,000 per annum—EVAO output farm businesses, and the highest proportion of total agricultural output emanating from small farms at almost 30percent. Mitchell shows a similar pattern, whereas in Surf Coast, quite to the contrary, close to 70percent of farm businesses have an estimated output of under $100,000, and 55percent of all output is produced by eight farm businesses within Surf Coast with an estimated output of over $1 million. These larges businesses are involved in poultry, dairy, cut flowers and nursery activity—and again the graph.
The key findings of periurban in that periurban report I referred to earlier is that agricultural activity at a range of scales remains a significant land use and economic function in the study area. The commercial value of agricultural activity is increasing in the periurban, however, this increase is largely driven by a few key enterprises. Trends in the region are generally towards an increase in smaller farm businesses and more land managers in the landscape. This is consistent with the trends that are indicated in chapter 4 in this report which you may have reference to later. The implication is that for a majority of farms there will be an increasing reliance on off-farm income and often, as those statistics indicated, as a primary income source, and that leads to issues as to whether or not the productive capacity of the land is in fact being exploited.
Although it provides some opportunities for removing farm management from agricultural markets and risk, in that the off-farm income tends to soften that blow, it also suggests that scope and commitment to structural adjustment may be limited. There is reference to other research in that regard. A few industries, notably poultry meat production, nurseries and flower growing, have increased significantly in scale and production. The poultry industry has undergone a significant period of restructure. In response to land use changes there is a growing urban incremental creep. They have seen centralisation of activity into fewer operations in more remote locations than previously.
The periurban region continues to offer advantages to some agricultural enterprises, and these advantages account for growth, maintenance and change in different types of agricultural businesses. The findings in the periurban report are consistent with other studies regarding the continued importance of periurban agriculture. But importantly the report finds that these advantages are threatened not just by global and national factors but by decisions at different levels of government in response to local pressures to increase and capitalise on small lot fragmentation.
Within sectors of the periurban region, government agencies exhibit a lack of longterm integrated strategic planning on matters such as the potential impact of land fragmentation on the viability of agriculture, landscapes, water supply, infrastructure provision and social impacts. The reason for the periurban group of councils being formed and the authoritive research undertaken is to work with government in partnership and in collaboration to address some of these issues. Quoting from page 14 of the periurban report:
In coming decades, climate change, water shortages, the rising importance of localised food production and the depletion of natural resources, such as oil, will raise periurban areas to new levels of significance. It will be increasingly prudent not to remove options which may prove essential to the effective functioning of metropolitan Melbourne and its periurban area. Land use planning can make an indispensable contribution to maintain options such as food production, biodiversity, maintenance and water supply.
The periurban group in Moorabool Shire believe, MrChairman, that the answer is establishing the periurban region as a distinct area for government planning and policy. We currently see the periurban areas fragmented into a range of regions. We are in the Grampians region, in a broader sense, and the Central Highlands region, in a subregional sense. We find councils, such as Mitchell, as in the Hume region and it fragments a lot of the policy solutions that we believe we need to be working with government to achieve. Quoting again from the report: