CHAPTER 4
THE STATES, COMMONWEALTH AND VALUE-ADDING INDUSTRIES
Introduction
4.1 This chapter follows on from Chapter 3 in providing information
on the role of States and Territories in supporting value-adding industries in Australia,
often in cooperation with the Commonwealth Government. The following subjects are dealt
with in the chapter:
- Role of the States and Northern Territory in supporting value-adding
activities;
- Importance of the relationship between the Commonwealth and State and
Territory Governments;
- Micro-economic reforms;
- Government supported research;
- Suggested government incentives to support value-adding activities:
- Government involvement in particular value-adding industries;
- Shared strategies between government and industry to support
value-adding activities;
- Failure of governments to support value-adding enterprises; and
- Adding-value overseas.
Role of the States and Northern Territory in supporting
value-adding activities
4.2 Through a wide variety of initiatives Australia's States and
Northern Territory have made valuable contributions to supporting value-adding
enterprises, related to agricultural production. In the following section the Committee
examines initiatives taken to support value-adding activities by the Victorian, South
Australian, Tasmanian, Queensland, West Australian and Northern Territory Governments.
Victorian Government initiatives
4.3 In evidence to the Committee the Victorian Government stated in April
1995 that it was committed to “keep building on the achievements
of the food industry and our agricultural industries and has committed
itself to a major agricultural food initiative which involves an extra
$22 million worth of funding over three years”. [1]
4.4 According to the Victorian Government it had emphasised the role
of the private sector in investing in value-adding activities. The Government
has assisted this sector by “removing barriers to competitiveness,
providing ways where productivity can be enhanced and looking at issues
of micro-economic reform which mean that the cost to industry can be reduced.”
[2]During its evidence to the inquiry
the State Government noted that between 1990-91 and 1993-94 private capital
investment in Victoria's food and beverage industries had grown from $339
million to $570 million. [3]
4.5 The Victorian Government told the Committee in 1995 that a body
named “Food Victoria” had been established to:
Help the State's food and food processing industries to achieve their
full potential by removing obstacles to investment and growth and encouraging
a highly competitive production chain from farm to marketplace. Other
aims are to promote and assist investment, improve the flow of market
information and encourage the market place identification of new market
opportunities. [4]
4.6 One component of Food Victoria is the Food Industry Advisory Committee
that has a sub-group titled the Food Industry Advisory Task Force. This
task force “works with the industry to implement strategies to help
the State's food processing industries achieve their full potential and
encourage a highly competitive production chain from the farm to the market
place.” [5]
4.7 The Committee was told the Department of Agriculture in Victoria
has undertaken a number of initiatives in various agricultural industries
to improve the State's competitiveness in agriculture. These initiatives
have included quality assurance programs, the provision of improved marketing
information, removing barriers to competitiveness and training and skills
development programs that focus on improving marketing skills related
to food production. [6]
4.8 Other initiatives in Victoria to promote value-adding in agricultural
production had involved the then State Department of Business and Employment
which had a number of programs in operation to assist the food processing
industry to “become world competitive and implement the world's best
practice”. [7] Department's initiatives included the delivery
of National Industry Extension Service's Enterprises Improvement Programs.
[8]
4.9 The Victorian Government established a number of other programs
and bodies that assisted in the support and promotion of value-adding activities in that
State. In 1994 these programs and bodies included:
- the Export Market Entry Program, administered by the then Office of
Trade and Investment, Department of Business Victoria; [9]
- the Overseas Projects Corporation of Victoria;
- the Rural Finance Corporation of Victoria (RFC);
- Regional Offices of the Department of Business and Employment and the
Small Business Development Corporation (SBDC);
- the Rural Enterprise Victoria (REV) program;
- the Business Advice for Rural Areas (BARA) program; and
- the Local Enterprise Development Initiatives (LEDI). [10]
South Australian Government initiatives
4.10 The South Australian Government informed the Committee that it
has made the following commitments to assist value-adding in agricultural production:
- a payroll tax rebate of up to 50 per cent for firms that generate
value-added exports;
- stamp duty relief;
- relocation assistance for plant, equipment and key personnel; and
- increased expenditure on rural roads. [11]
4.11 The South Australian Department of Primary Industries stated in
May 1995 that it was formulating industry development plans for seventeen
primary industry sectors. Each of these plans were being prepared and
implemented to integrate with Commonwealth agribusiness programs. According
to the Department all the plans would “be market-driven and will
focus on processing as well as primary production”. [12]
4.12 At that time the South Australia's Economic Development
Authority was another body that provides support for businesses involved in value-adding
activities in that State. The Authority's assistance to value adding enterprises included:
- marketing advice;
- assistance in gaining market intelligence;
- assistance with Australian and foreign government procedures;
- financial assistance provided through the South Australian
Development Fund; and
- the provision of business planning advice through the South Australian
Centre for Manufacturing and Small Business Corporation. [13]
4.13 Other programs and bodies operated by the South Australian
Government in 1994 to support value-add activities in that State, included:
- Development and Marketing Program, administered by the South Australian
Department of Primary Industries; [14]
- South Australian Economic Development Fund, administered by the
Economic Development Authority;
- Rural Finance and Development, Commercial Rural Loans, administered
by the South Australian Department of Primary Industries; [15]
- Small Business Corporation (SBC); and
- Business Advice for Rural Areas (BARA) Facilitators. [16]
Tasmanian Government initiatives
4.14 The Tasmanian Department of Primary Industry and Fisheries
examines proposed value-adding enterprises for possible State support. The Department
stated in 1994 that:
Three multidiscipline groups have been established to initially screen
new plant, new animal and new marine industry opportunities and give
them a priority for investigation. [17]
4.15 One of the criteria used in selecting a high priority opportunity
was whether the enterprise offered “value adding potential within
Tasmania”. [18]
4.16 As of 1994 the following Tasmanian Government programs and
bodies supported value-adding activities:
- the Export Market Advice Program, administered by Tasmania-Development
and Resources; [19]
- Local Employment Initiatives (LEI), administered by the Tasmanian
Department of Employment, Industrial Relations and Training; and
- Business Advice for Rural Areas (BARA) Facilitators. [20]
Queensland Government initiatives
4.17 The Queensland Government had several programs and bodies in
1994 that supported value-adding activities in that State, including:
- the Export Advice and Enquiry Service, administered by the Department
of the Premier, Economic and Trade Development; [21]
- Department of Business, Industry and Regional Development (DBIRD);
- the Regional Economic Development Program; [22]
- Business Advice for Rural Areas (BARA) Facilitators;
- the Queensland Small Business Corporation (QSBC);
- the Queensland Industry Information Service (QINDIS);
- the Queensland Business Licence Information Centre (QBLIC); and
- the Queensland Business Information Service (GOBIS). [23]
West Australian Government initiatives
4.18 Traditionally, Western Australia's exports have been mainly bulk
commodities and lightly processed products. However, according to the
West Australian Government “recently, increased emphasis has been
placed on further processing of agricultural commodities”. [24]The
Government submitted that there was an increasing recognition that to
attract premium prices in the marketplace, or even to hold market share,
emphasis had to be put on the production of quality products rather than
concentrating on producing bulk commodities. [25]The West Australian Government stated:
While there is limited capacity at present in Western Australia for
elaborate processing of primary products there are significant opportunities
for adding value by differentiating the product in the market place,
and by attention to quality through grading, post-harvest treatment,
branding, packaging and presentation. [26]
4.19 The following Government programs and bodies operated in
Western Australia to assist and promote value-adding activities in 1994 :
- Export Market Support Scheme, administered by the WA Department of
State Development; [27]
- Investment Incentive Program, administered by the WA Department of
Commerce and Trade;
- Locate to Western Australia Program, administered by the WA
Department of Commerce and Trade;
- New Industry Investigation Funding Program, administered by the WA
Department of Commerce and Trade;
- Western Australian Innovation and Support Scheme (WAISS), administered
by the WA Department of Commerce and Trade; [28]
- Regional Development Commission;
- Local Enterprise Centre Program;
- Business Advice for Rural Areas (BARA);
- Small Business Development Corporation (SBDC);
- SBDC Business Licence Centre;
- Industry Knowledge Base (IKB) registry; and
- the Agwest Development body. [29]
4.20 In November 1994 the WA Minister for Primary Industry announced
new policies for the delivery of Government services to the agricultural
sector. The Committee was informed that as part of the restructuring process
in Western Australia, “there is to be a focus on facilitating the
opportunities available for value adding, both on and off the farm.”
[30]
Northern Territory Government initiatives
4.21 To support value-adding projects in the Northern Territory the
NT Government had put the following program in place as of 1994:
- the Export Marketing Assistance Scheme that was administered by the
NT Department of Industries and Development. [31]
Footnotes
[1] Evidence, Victorian Government,
p. 41.
[2] Evidence, Victorian Government,
p. 43.
[3] Evidence, Victorian Government,
p. 41.
[4] Evidence, Victorian Government,
pp. 27-28, 44.
[5] Evidence, Victorian Government,
p. 46. For more detailed information on the structure of Government bodies providing
assistance to value-adding in Victoria see Evidence, Victorian Government, pp.
44-49
[6] Evidence, Victorian Government,
p. 28.
[7] Evidence, Victorian Government,
p. 28.
[8] Evidence, Victorian Government,
p. 28.
[9] For more information on support
provided for exporters by the Victorian Government see Evidence, Victorian
Government, pp. 53-54.
[10] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, pp. 11-12, 29-30..
[11] Evidence, South Australian
Government, p. 554.
[12] Evidence, South Australian
Government, pp. 554, 558.
[13] Evidence, South Australian
Government, p. 555..
[14] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, p. 13.
[15] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, pp. 22-23.
[16] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, pp. 36-37; see also Evidence, South Australian
Government, pp. 577-582.
[17] Ralph Stuart, A Tasmanian
Approach-from Atlantic Salmon to Green Tea, Outlook 94, Vol. 3, Agriculture:
collection of papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 74.
[18] Ralph Stuart, A Tasmanian
Approach-from Atlantic Salmon to Green Tea, Outlook 94, Vol. 3, Agriculture:
collection of papers delivered at the Outlook 94 Conference held in Canberra 1-3 February
1994, organised by ABARE, p. 74.
[19] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, pp. 14, 23.
[20] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, p. 38.
[21] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, p. 12.
[22] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, p. 19.
[23] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, pp. 32-33.
[24] Evidence, West Australian
Government, p. 685.
[25] Evidence, West Australian
Government, p. 686.
[26] Evidence, West Australian
Government, p. 687.
[27] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, p. 12..
[28] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, pp. 20-21..
[29] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, pp. 33-35..
[30] Evidence, West Australian
Government, p. 687; see also p. 693
[31] DPIE, Rural Business &
Marketing Guide, Canberra, 1994, p.14.