Did you know in Australia it’s possible to ruin a business if you don’t like the way it smells? This is a heartbreaking story ”” that a government could effectively ruin a family by slowly strangling them in red tape, and that they would have apparently no protection from the courts or the ombudsman. It eats away at our sense of justice. Can we speak freely? Are we all treated equally under the law, or are some laws only enforced according to a capricious whim?
This is the price we pay for vague laws where business people can run ventures, do everything to the letter of the law, with best-practice procedures, winning customers and contracts, yet go broke despite all that because of onerous, impossible-to-meet conditions, that are unmeasurable, and change suddenly, with the added bonus of inordinately long delays. At the moment, Janet and Matts farm, Narrogin Beef Producers, lies empty, unstocked, while debts accrue by the minute.
This is also a story of sovereign risk. Investors in Australian industry beware.
Unused equipment that cost hundred of thousands of dollars lies idle.
How can any business survive the need to get two-yearly licenses which take more than 12 months to arrange; where after four years of planning and preparation, capacity can be suddenly halved without warning; where an appeals process can take 18 months and when the original capacity is finally restored, not only are many new stipulations added, but the expiry date is not extended. After 30 months of a grinding process, the farmer is only left with 6 months before the amended license expires and no way to take out loans based on such an uncertain future.
If the government were a private business paid to arrange licenses, and expected to be evidence based and to respond in a reasonable time, then they would have no customers. Indeed, they could be sued.
Matt and Janet were told their license would be a formality, and they took out loans and contracts for water and grain in advance. Their input costs last year added up to around $10 million dollars. When the capacity was halved there was no way under the laws of biology and commerce that they could bring in the cash flow to meet those costs. When they appealed, they was no timeframe, no indication it would take 18 months to be resolved, so they took out loans, bore the costs, the interest, and paid for water they did not use, and grain no cow would eat. Their money was effectively squandered by the unpredictable rulings of the state government.