Surely not a pre-budget forearm jolt?

The table of numbers (below) was published in March and presented at the grower meetings last week.  It tells a number of stories.

  1. The winegrowers of the Riverland have been amazingly resilient for a long time.
  2. They have contained plantings, contained yields, improved the scale of operation, reduced the number of vineyards dramatically and survived.
  3. Few, if any other regions, can illustrate such a staunch, response to the demand for structural adjustment.

Putting this into context for industry outsiders, it is widely accepted that approximately 1,000 bottles of wine is produced from every tonne of grapes crushed.  A quick glance at the numbers above reveals that for the past five years, growers in the region have somehow managed with an equivalent return of just 30¢ from every bottle of wine produced!

That 30¢ must feed and clothe the winegrower, provide for all other family expenses and pay for all water, fuel, fertiliser, pest control, weed control, pruning and harvesting expenses. Our Riverland community has been the big winner with growers pumping more than $580M into the regional economy in just the past five years.

Critics, sitting comfortably in the gallery will chorus, “go do something else”, and indeed many have done just that. Many have moved on but the ongoers have also pumped more funds into Research, Development and Extension than any region in the country in a courageous on-going bid to be even more competitive in our export markets.

Story four is the story of what the Riverland Wine association has been striving to achieve for almost two years; sensible reform of wine tax policy, in particular, WET rebate policy. There is a well-founded belief, now shared across industry and based on detailed studies, that reveals poor policy is a major cause of market price distortions that left unchecked have caused of much industry anguish.

In the past six months the association, in another first for the wine industry, has collaborated successfully with the Winemakers Federation, Wine Grape Growers Australia, all State Wine Industry Associations and international accounting firm Price Waterhouse Coopers, to redress the flaws in the policy and clear the way for all of industry to move forward, in harmony. If implemented, the proposal will be phased in over 4 years, iron out the wrinkles that offer free kicks to New Zealand producers and protect the interests of cellar door operators throughout Australia. Crucially, it will save the Australian taxpayer $280M over the four year adjustment period. In exchange, industry has requested a very modest $25M over the period to boost marketing initiatives.

In summary, it seems there will be few if any losers. The proposal well and truly passes the test of “the common good”. The proposal is NOT a call for help. It is a self-funded, sensible and fair proposal to amend tax policy and enable the industry to grow the pie for regions, jobs and exports; win, win, win! It’s difficult to imagine a more balanced pre budget submission.

Imagine the shock and dismay when reading a short piece on page 4 of Thursday’s (April 30) Australian that reveals somehow it’s all come unstuck. For now we have to hope that Treasurer Hockey was mistaken. If not, then it’s time for the (nameless) critics in the gallery to come down into the arena, declare their hands and illustrate why it is so.

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