The West Australian State Government will return $650,000 to potato farmers after it made the decision to drop a grower-funded legal case against Perth businessman Tony Galati.
Potato growers were furious when Premier Mark McGowan decided to drop a civil suit against Mr Galati in May without any consultation with the farmers who had helped fund the action.
Mr McGowan said the case, which was launched in 2015 by the now-defunct Potato Marketing Corporation when Mr Galati grew potatoes outside his quota, was no longer relevant since industry deregulation last year.
In response to the abandoned legal action, farmers sent the State Government a bill for $500,000 to try and recover their money.
The State Government has now confirmed that $484,316 recovered from the legal trust would be distributed back to growers, as well as an additional $200,000 in costs paid by Galati Nominees to the Government.
An "allocation calculation" that was established by the Potato Marketing Corporation before it was dismantled has been used to ensure funds will be distributed fairly among 74 potato growers.
In a statement, the WA Minister for Agriculture and Food Alannah MacTiernan said the Government had "drawn a line under the era of regulation of the potato industry".
Cash offering offensive to growers
WA Potatoes executive officer Simon Moltoni said he was pleased the Government would return some money.
But he said the figure quoted was only part of the money owed to farmers, and the Government was also trying to cheat growers out of their full entitlement.
"What the media release doesn't say is that there is a deed of distribution that growers must sign in order to access these funds," he said.
"Growers are basically being asked to sign away their rights to recoup the overwhelming majority of their money, which is still outstanding."
Mr Moltoni said there was about $1.3 million that WA potato farmers were looking to recoup from the State Government.
But he said growers might accept the offer of $650,000, even though it was unfair.
"Unfortunately growers are a bit desperate at the moment," he said.
"With deregulation and the closure of national borders due to biosecurity incursions we recently had, the market is oversupplied and growers are receiving very low prices.
"So they are probably not going to be in a position to say no to their money."
