Our particular focus when it comes to succession is on a particular resource that it is not often talked about and that is the human resources and as Carolyn mentioned earlier some of those statistics that relate to the human resources that support agriculture in Australia are quite alarming. And one that we certainly have noticed and pay a great deal of attention to is that the proportion of farmers in Australia aged over 55 have doubled in the last 20 years and most alarmingly the proportion under 35 have more than halved.
So you know we have to be very cognizant of the fact that yes, land resources are critical so are water resources, but so a human resources as well and. You know one of the things that Jen and Devita spoke about this morning were a number of times they’re their discussion touched on the people side of things and how important it was to have that continuity and to know that the next generation are there ready to take on what is a tough industry in terms of farming and agriculture. And you know when we speak to government we get lots of very positive feedback about: “Yeah, you’re right Jim. This is this is a critical issue. We’ve got to do something about this” And you know Barnaby Joyce one of his many famous statements he said: “Australian Family Farms are the heart of Australian agriculture.” Now all that rhetoric is fantastic, what we would like to see is some policy to back it up. And you know we often hear that when farmers that the farmers are forever putting their hand out and asking for something that somebody else doesn’t get. What doesn’t often get spoken about is the opposite. The number of policies and legislation and supporting legislation that actually puts the farming community at a distinct disadvantage.
And I was really interested in the discussion today because there are some things that exist that are particularly difficult when it comes to farming on the Urban fringe, and I’ll just point to a couple. One of the great inhibitors in trying to move assets to the next generation is capital gains tax and we get no special concession on that.
So we have to look around to wherever we can reduce those costs and one of the most important areas are the concessions that are given to small businesses. They are critical in trying to reduce the impost of that tax burden and one of the problems is that the thresholds that have been entrenched in legislation that have not changed for years and years and years and even recently when the government increased the threshold as you probably remember to a definition of the small business to 10 million, they decided when it came to capital gains tax that might cost too much, so they kept that back to what it was. And so the threshold for the asset side is six million dollars, and I can tell you that it doesn’t take a lot when you’re on the Urban fringe for property values to exceed six million dollars and that can have a huge impact when it comes to as I say the tax burden that emerges when you try and transfer assets to the next generation.
So a similar situation applies when we’re looking at the other end of the scale to the access to the age pension. Now superannuation levels in agriculture are the worst by far of any industry and one of the problems where people are accessing the age pension. Is that you know you can have a 10 million dollar house looking out over Sydney Harbor, and you can still get the age pension, but when you have land around you that you needed to survive on, to be able to run your business that’s counted against you and so we see many tragic circumstances where people are unable to access benefits that if people living in the city would be walking up, no marching, up and down the streets about. So there are clear policy frameworks that that inhibit the opportunity for us to move assets to the next generation. So I think there’s a lot that government can do at all three levels.