A PUBLICITY stunt claimed would help struggling dairy farmers cope with the crippling drought has backfired on supermarket giant Coles.
Agriculture Minister David Littleproud is the latest to join a growing chorus of critics of Coles 10c/litre ‘milk levy’ and the Coles Dairy Drought Relief Fund, saying it had become a farce.
“The original idea of a milk levy floated by the Queensland Diary Organisation was that it would be applied to all brands of milk and go back to the processors who supply the supermarkets, so the extra 10c/litre supplied could be paid directly to the farmers by the processors for the milk they'd supplied,” Mr Littleproud said.
“There is now no guarantee the money Coles collects will even go to the farmers who supply its supermarket with milk, let alone be paid according to the volume of milk they supply Coles.”
Mr Littleproud said Coles never wanted to make sure farmers received fairer pay and made a hasty announcement to match their competitor Woolworths.
"I was initially prepared to give the benefit of the doubt but it hasn't been followed up with good policy work. It's an empty media stunt," Mr Littleproud said.
"The result is a half-baked policy which only applies to Coles' 3-litre variety of their own milk brand - and may not even go back to the farmers who supply that tiny portion of drinking milk.
"I was also disappointed Woolworths only applied the levy to their own $1 milk.”
I was initially prepared to give the benefit of the doubt but it hasn't been followed up with good policy work. It's an empty media stunt
Queensland Dairy Organisation vice president Matthew Trace said National Farmers Federation had walked away from administering the funds.
“The NFF also likely realised that its involvement was counterproductive and could affect its relationship with its member organisation the Australian Dairyfarmers’ Federation,” Mr Trace said.
Following the rebuff by farmers, Coles said it would be would be handling the distribution of the proceeds of its 30c on 3L private label product internally, based on an application process.
In its application guidelines, Coles states: “Coles will ensure 100 per cent of the proceeds from the additional 30c on sales of Coles Own Brand 3L milk between 21 September and 31 December 2018 will go directly to drought-affected dairy farmers. Eligible applicants are drought affected dairy farmers, including dairy farmers experiencing dry conditions and/or facing higher input costs due to the rise in prices for feed and water caused by drought.”
However, Mr Trace said it was unclear who was eligible to receive the funds.
“Consumers will buy into these ridiculous PR stunts thinking they are doing the right thing. But when you read between the lines, it amounts to both Coles and Woolworths capitalising on the drought for their own gain since it’s applied to only to a version of their private label,” Mr Trace said.
“Without a doubt, Coles will defend its decision by saying that the levy was to help all farmers struggling due to drought, and that’s correct. There was a very good reason we called for the levy to be across all sizes and all brands nationwide but that's not what they've done.
“It is a sign of their corporate greed that something we are trying to do to help our struggling dairy farmers should be used for growing their own market share. Truly they should be ashamed.”
Mr Littleproud conceded Coles and Woolworths had committed more than Aldi which has refused to look at a levy at all.
“The big German can go and take a running jump if they can’t be bothered to support Australian dairy farmers,” Mr Littleproud said.
"The best thing shoppers can do is buy branded milk, not supermarket brand milk or better still, shop at independent grocers.
"Personally, I don't shop at the big supermarkets. They've got a lot to answer for. The big supermarkets can't just wash their hands and claim the fact farmers going broke is nothing to do with them.
"The fact is the milk market needs real reform. It's not working. I've begun work on a mandatory code of conduct for the sector since the Australian Dairy Farmers group called for it, and much more reform is needed."