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Rural connectivity missing from 2018 budget

Richard Heath - Thursday, May 10, 2018

Thanks to an increasingly strong economy delivering better than expected tax receipts, Treasurer Scott Morrison has been able to deliver an election-friendly 2018 budget, including tax cuts and infrastructure spending. Whether you are an individual, business or government, higher levels of income provide more options and opportunities. The trick is in having the confidence that those increased receipts are sustainable and will not be impacted by your spending choices.

So, if sustained growth in tax receipts from a growing economy (rather than higher taxes) is the key to the government’s balance sheet, what has the 2018 budget delivered that will enhance the agricultural sector’s potential?

 Australian farmers need to be able to run efficient and connected businesses...

The $100 billion target for Australian agricultural GVP by 2030 (a $40b increase from current levels) - vigorously promoted by the National Farmers’ Federation - is almost entirely dependent on increasing the value of exports. For this reason, the measures announced for new agricultural trade counsellors ($51 million over four years) are a sensible and welcome enhancement for Australia’s capacity to develop and maintain export markets. Likewise, the $121m boost to biosecurity is an essential component to export market development. Significant regional spending on roads and infrastructure - alongside last year’s inland rail funding - is a great start to improving supply chain efficiencies, and thus competitiveness for Australia’s produce.

However, to make use of export opportunities, particularly as direct interaction with overseas consumers becomes increasingly important, Australian farmers need to be able to run efficient and connected businesses; and in this area, what was left out of the budget was disappointing.

While the $260m for satellite infrastructure and more accurate global positioning system (GPS) technologies will undoubtedly benefit some producers immediately, and the entire sector long-term, the Mobile Blackspot Program was a ‘blind spot’ in this budget. New investment for this will halt next financial year, leaving many farmers without coverage on- or off-farm.

In comparison, the US recently passed the Precision Agriculture Connectivity Act, providing $600m to fund solutions for broadband connectivity issues in rural America. As the Bill’s proponent Senator Amy Klobuchar said, for a business to not be properly connected “is unacceptable in a 21st Century economy that demands efficiency”.

The budget announcements aimed at enhancing agricultural trade capacity and building regional infrastructure are welcome and will go towards increasing growth potential for Australian agriculture. However, there is still much to be done in providing the tools that farm businesses require to operate in a connected world in order to take advantage of that growth potential.

 
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