As with all policy areas, agricultural policy is developed against a backdrop of conflicting values, such as the differences between environmental and production values and between importers and exporters (for example, over the stringency of quarantine requirements). In his seminal work on incrementalism, Lindblom (1959) argued that one of the advantages of incremental policy development was the capacity for policy to address values that had been overlooked in earlier iterations. He described the policy process as serial and remedial and he argued that this was an effective way for policy to be developed. He also argued that for this process to work successfully, each value should have a watchdog that focused on particular aspects of the policy to ensure that it was represented. More recently, Thacher and Rein have made a similar argument about strategies for balancing values in policy development. They suggest several approaches that can be adopted to address value conflict. The first of these, ‘policy cycling’, is similar to Lindblom’s serial and remedial incrementalism, suggesting that policymakers ‘focus on each value sequentially, emphasizing one value until the destructive consequences for others become too severe to ignore’ (Thacher and Rein 2004:463). The second strategy they identify is the construction of ‘firewalls’ that divide responsibility for different values among institutions ‘ensuring that each value has a vigorous champion’ (Thacher and Rein 2004); the similarities with Lindblom’s watchdogs are clear.

The interesting aspect of these approaches is that the analysis focuses on identifiable values—values that have clear advocates and that can be easily identified in the issues being debated in a particular policy area as different perspectives on complex social problems. Rokeach (1979:55) goes as far as arguing that ‘there are no terminal or instrumental values that will be “left over”, that are not the focus of specialization by at least one social institution’. An alternative perspective is that some values operate at a deeper cultural level and are not articulated in policy debate. Feldman (1988:418) argues that widely shared core values and beliefs ‘may be so pervasive that their presence in everyday politics often goes unnoticed’. Sabatier refers to ‘deep core’ values that are exogenous variables in policy advocacy and ‘are very resistant to change—essentially akin to religious conversion’. They consist of ‘fundamental normative and ontological axioms’ (Sabatier 1988:144). Williams is one of the few writers who points to explicit values and those that are not:

Different mixes of values will deliver different policy outcomes. In Europe, agrarian values are clearly influential in the policy settings of the Common Agricultural Policy (CAP). Ockenden and Franklin (1995:1) argue that ‘the CAP provides evidence that agriculture carries a cultural and social significance far in excess of its economic importance. The policy is neither an afterthought nor an expensive irrelevance, but the manifestation of the unique place of agriculture in the psyche of industrial societies.’

In Australia, production values have dominated in recent years with policy emphasis on productivity improvement and competitiveness. The mix changes over time as different values gain ascendancy in policy debate (Botterill 2004). Rural policy communities are archetypal ‘closed’ networks (see, for example, Grant and MacNamara 1995; Smith 1992), which have a shared approach to policy and which exclude competing views from the process. The peak Australian farmers’ representative body, the NFF, was established in 1979 and from the outset was at the forefront of neo-liberal debate. It has consistently advocated free trade, domestic deregulation and labour market reform and it has extended these policy prescriptions to its own sector. In its 1981 paper Farm focus: the ’80s, the organisation stated that the ‘NFF does not believe that any industry—rural, mining, manufacturing, or tertiary—whether highly protected or not—should be permanently shielded from the forces of economic change. The overall interests of the economy demand that all industries must participate in the inevitable adjustment process’ (National Farmers Federation 1981:48).

As Lawrence (1987:79) wrote, in the 1980s, the NFF became ‘one of the most vocal proponents of a deregulated economy and a free enterprise agriculture’. It was therefore at home in the agricultural policy community with the Australian Bureau of Agricultural and Resource Economics (ABARE) and the Commonwealth agriculture department, currently the Department of Agriculture, Fisheries and Forestry (DAFF). After several decades of highly interventionist agricultural policies in Australia, agricultural economists in the 1960s began to question policies of government intervention in agriculture (see, for example, Lloyd 1970; Makeham and Bird 1969; McKay 1967) and, by the 1980s, neo-liberal approaches to rural policy were firmly entrenched. While agrarian values were clearly articulated in the first half of the twentieth century (see, for example, Chifley 1946), they seemed to disappear from policy settings from the 1970s onwards. Policies have focused on deregulation, structural adjustment and productivity improvement, examples of which include deregulation of the dairy industry, privatisation of the former Australian Wheat Board and changes to regulatory arrangements for the wool industry.

The language of policy statements, however, does not necessarily match the reality of policy implementation and policymakers are not averse to appealing to agrarian sentiment when explaining decisions that might otherwise appear inconsistent with stated policy direction. Within the rural policy community there is no identifiable watchdog for what might be characterised as agrarian values; the main players have for more than two decades pursued neo-liberal policy objectives (Botterill 2005). The absence of a visible agrarian interest, however, has not meant that these values have disappeared from policy. They remain an important socio-cultural phenomenon and appear to have an important role in protecting rural policy from rigorous critique, thus facilitating the emergence of inconsistencies in approach between rural and non-rural policies. These inconsistencies are disguised either by rhetoric that reflects overall government policy direction while hiding the reality of implementation or by the use of values-based language to justify inconsistencies when they are obvious. The National Party has been particularly effective at using agrarian imagery for this latter purpose and in defence of its position as part of the Australian political landscape.

A good example of the gap between the rhetoric and the reality is the National Drought Policy (NDP). Agreed by Commonwealth and state governments in 1992, the NDP was a watershed in government responses to drought. It followed the removal of drought from the natural disaster relief arrangements and was based on the principle that drought was not a disaster but part of Australia’s climate. The NDP was based on principles of self-reliance and risk management and argued that drought was a risk to be managed by farmers like any other risk facing the farm business. The policy included a series of programs aimed at improving farmers’ risk-management skills and introduced tax-effective financial risk-management programs aimed at encouraging farmers to build financial reserves on which they could draw in dry years. The policy included an important caveat: it introduced the concept of ‘exceptional circumstances’ to describe circumstances that were so extreme that even the best manager could not be expected to cope. In these conditions, further government support to farm businesses would be triggered, however, it was available only to businesses that were considered to have a long-term productive future in agriculture. Policymakers were concerned that drought relief not act as a de facto subsidy to otherwise unviable businesses.

In 1994, the NDP was augmented with the creation of a welfare payment, currently called the Exceptional Circumstances Relief Payment (ECRP), which was linked to exceptional circumstances declarations and this payment changed the whole tenor of the program. The first major shift towards a more agrarian approach was that the viability test did not apply to the welfare payment—so farms that were ineligible for the business support could be eligible for the welfare payment. This altered the incentive structure of the policy as the availability of the welfare payment made attaining an exceptional circumstances declaration more attractive, essentially undermining the objective of self-reliance and risk management. Instead of being motivated to manage a current dry spell, it was more sensible for farmers to make a case that the dry spell they were experiencing was particularly bad in order to access government support. In 1999, ministers went so far as to change the definition of exceptional circumstances drought to elevate the impact of drought on income to the threshold criterion (‘key indicator’) for a declaration (ARMCANZ 1999:63).

Until 2005, the welfare payment had been paid at the same rate as other income-support payments available to the Australian community—for example, the unemployment benefit. In May 2005, the government announced that it was increasing by $10 000 the amount that a farmer could earn before their drought payment was reduced (Truss 2005), meaning that farmers on drought relief could earn more than twice as much a fortnight as an unemployed person before losing any income support. Farmers are also not subject to any mutual obligation requirements. The May 2005 announcement passed unnoticed by the mainstream media. In its response to the announcement, the NFF continued to use the language of the NDP, noting that ‘Australian farmers acknowledged the importance of preparing for, and managing, business climatic risks such as severe drought’. After welcoming the increased level of drought support, the organisation stated:

This type of apparent contradiction is not uncommon in rural policy debate—using the neo-liberal language of the NDP while welcoming an inequitable increase in support to farmers that is unrelated to economic outcomes.

The privatisation of the statutory Australian Wheat Board provides a further example of rural policy development that has occurred apparently without reference to broader policy approaches. Deregulation of the wheat market began in 1989 with the removal of the Australian Wheat Board’s monopoly over the domestic wheat trade. This change occurred in a climate of general industry deregulation, which had been pursued by the Hawke Labor government from 1984. From 1990, the grains industry started a process of strategic planning that included consideration of the future of export marketing arrangements for wheat. The level of urgency associated with this consideration was increased from 1993 when the report into national competition policy (Hilmer et al. 1993) was published, which included a section on the anti-competitive nature of agricultural statutory marketing arrangements and a chapter on monopolies. In 1995, debate within the grains industry became focused on the future structure of the Australian Wheat Board, with a particular focus on the board’s export monopoly—the so-called ‘single desk’. Discussions and debate about the structure took place largely independently of government with the main players being the peak industry body, the Grains Council of Australia, and the Australian Wheat Board. The Department of Primary Industries and Energy had a place in the discussions but did not advocate a strong position. This was consistent with the approach taken by consecutive Ministers for Primary Industries and Energy, Senator Bob Collins (Labor) and John Anderson (National). The final model was developed by industry and implemented through two tranches of legislation in 1997 and 1998. The outcome was a privatised body, AWB Limited, which essentially retained the single desk. The government did not drive the privatisation process, the Department of Finance did not have a central role in the process and the objectives for the privatisation were set by the grains industry, not by government. There is little indication that the government took strong action to protect the public asset associated with the export monopoly, marking the process as a ‘very peculiar privatisation’ (Aulich and Botterill 2007).

The grains industry continued to be treated differently when the legislation that embodied the export monopoly, the Wheat Marketing Act 1989, came due for review under the National Competition Policy (NCP). While the usual practice for NCP reviews was for the Productivity Commission to undertake the review, the Wheat Marketing Act was reviewed by a committee that included the former president of the Grains Council of Australia (Irving et al. 2000). The Productivity Commission made two submissions to the review (Productivity Commission 2000a, 2000b) in which it argued the case for the repeal of the export monopoly. The NCP review, in contrast, recommended that ‘the “single desk” be retained until a scheduled review in 2004 by the Wheat Export Authority of the privatised AWB’s operation of the “single desk” arrangement’ (Irving et al. 2000:8), although it also stated that ‘the main purpose and implementation of this scheduled review should be changed so that it provides one final opportunity for a compelling case to be compiled that the “single desk” delivers a net benefit to the Australian community’ (Irving et al. 2000:8). The Commonwealth Government rejected this last recommendation. The National Competition Council subsequently found that ‘the Government’s review of the Wheat Marketing Act was open, independent and rigorous’, however, it concluded that ‘the Commonwealth Government had not met its [competition principles agreement] clause 4 and 5 obligations^[1] arising from the Wheat Marketing Act’ (National Competition Council 2003:1.8).

The single-desk arrangements for the wheat industry have come under more general public scrutiny since the Cole Inquiry into the Oil for Food Program and the revelations of AWB Limited’s bypassing of the Iraqi sanctions regime (Cole 2006). It is, however, arguable that the interest in this scandal by the mainstream media and commentators was prompted by the possibility that senior ministers were aware of the behaviour rather than a considered critique of the rural policy underpinning the existence of an export monopoly in the hands of a private company.