Backpacker fiasco is harming horticulture supply chain

fma-logoFresh Markets Australia (FMA) has called on the Federal Parliament to put an end to the political point scoring and agree on the tax rate for Australia’s overseas backpacker labour before more damage is done to the $9 billion horticulture industry. The comments follow the defeat of the Coalition’s plan for a 15% backpacker tax in the Senate this morning, which would have imposed the same rate on overseas labourers as the 8,000 Pacific Island workers who supply farm labour in the regions.

The “backpacker tax” rate will revert to 32.5% from January 2017 without parliament’s agreement on a new rate, and from the reports of Australia’s peak grower bodies, the uncertainty is driving away the overseas backpacker labour force in droves.

FMA Director, Andrew Young, said political point scoring must stop. After the ongoing debate and delays, there must be agreement. The compromise position of a 15% tax had been supported by peak grower representative organisations, so why is this matter still being debated?

“Grower bodies are also informing us that supply volumes to the Central Markets will certainly be cut with hundreds of thousands of dollars’ worth of fresh produce left in the paddock if the labour is not there to pick and pack it,” Mr Young said.

“Bowen Gumlu Growers Association is reporting a drop of 10% in backpacker labour while this fiasco plays out just as the busy mango season is upon them.

“Growers across Australia who rely on overseas labour are in the same situation. It affects the whole supply chain and will ultimately affect consumers in the prices they pay for their food.”

Up to 60% of the fruit and vegetables on the plate have travelled through one of six Central Markets, who are supplied by 15,000 Australian growers who rely heavily on local and overseas labour to send to the Central Markets.

“That will mean shorter supply, higher prices paid at the wholesale level and ultimately, more expensive retail prices for consumers,” Mr Young said. Ω

Posted 30 November 2016


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