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Rent relief still on PGA’s wish list

Melissa WilliamsCountryman

The Pastoralists and Graziers Association has renewed its push for legislative changes to the way WA's pastoral rents are assessed.

The move comes in the wake of last week's decision by the State Administrative Tribunal (SAT) to reject a challenge by two of Australia's biggest pastoralists to the valuation of their Kimberley pastoral leases.

The valuations formed the basis of the State Government's standard five-year pastoral rent review in 2009.

WA pastoralists have been closely monitoring this three-year test case, in which Paul Holmes a Court and the Kidman family argued the Valuer-General had greatly overvalued their land and claimed the methodology used to determine lease rents was inconsistent and had resulted in exorbitant rent rises.

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Paul Holmes a Court said rents had quadrupled on several of his properties, which include Nicholson, Flora Valley and Gordon Downs, and the issue should have been addressed by the Minister for Regional Development and Lands.

"We did not want to have to use the SAT, but we had no alternative," he said.

Mr Holmes a Court said the SAT decision would not be taken any further by his company or the Kidmans, but he hoped the Minister would fix the problem.

East Kimberley cattle producer David Stoate is also in the process of appealing his land valuation from the 2009 rent review process and said he had hoped common sense would prevail at the SAT last week.

"If the challenge had been successful, it would have set a precedent," he said. "The decision was very disappointing."

Mr Stoate said he would proceed with challenging his land valuation, which led to a 400 per cent hike in his pastoral lease rent from $14,000 to $71,000.

He said the highest Kimberley pastoral rent increase resulting from the 2009 rent review was 700 per cent and the average lease went up 350 per cent.

"Land values have not risen that much and I believe the process did not adequately take into account the economic circumstances of pastoralists at the time, as it is supposed to do," he said.

"This happened before the Indonesian live export ban was imposed, but at the time we were all dealing with massive cost increases and low commodity prices."

Mr Stoate said there were no guarantees that pastoral leases would not be increased by a similar magnitude during the next pastoral rent review, scheduled for July 2014, and a better system needed to be introduced.

He said the level of risk surrounding pastoral rents needed to be limited and a fairer outcome achieved for producers.

Mr Stoate said annual pastoral lease increases linked to inflation would be acceptable and pastoralists would also continue to fight to have the last round of rent rises revoked.

The PGA has written to Regional Development and Lands Minister Brendon Grylls to make legislative changes to the way pastoral leases are assessed before the next five-year round of rent appraisal starts in 2014.

Pastoral rent is currently calculated every five years by a formula dictated under the Land Administration Act.

PGA president Rob Gillam said that since the Indonesian live export ban, enforcement of the 350 kilogram limit for export cattle to Indonesia and extensive drought in many areas south of Port Hedland, northern pastoralists were under a lot of pressure and some were going backwards.

"The range of rent increases we saw for the northern Pilbara and the Kimberley post-2009 are too high to be sustainable and we are concerned these will become the basis for the next round of potential rate rises stemming from the 2014 rent review process," he said.

Mr Gillam said the PGA did not know how many WA pastoralists had appealed against their Valuer-General property valuations after the 2009 rent review, but several had been successful in getting small reductions.

He said the outcome of the SAT challenge last week was disappointing for the wider pastoral sector and producers in the process of - or considering - an appeal.

Mr Gillam said the current method used by the Valuer-General to value pastoral leases was clearly not working.

He said, through a review of the legislation, the PGA wanted five assessment zones set up, valuations based on fully flexible rates in the dollar that would lead to outcomes-based rents and an annual assessment of local conditions.

Mr Gillam said pastoralists could deal with moderate annual rental increases that were tailored to factors such as the season and cattle prices.

He said this would require the same number of assessments as was undertaken for annual pastoral vermin rates. Assessments could be conducted by the statutory Pastoral Lands Board.

Parliamentary Secretary to the Minister for Regional Development and Lands, Wendy Duncan, said the State Government had been reviewing pastoral rent calculations and would continue to do so in the wake of last week's SAT decision.

"We will re-assess how pastoral rents are calculated, but one of the things that has been established in this case is that there are not a lot of grounds for appeal," she said.

"We have to acknowledge that the Tribunal has assessed the process."

She said the Government was also considering a regional model that could take into account climatic and market conditions when setting rents.

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