Bills Digest No. 3 2004-05
Agriculture, Fisheries
and Forestry Legislation Amendment
Bill (No.2) 2004
WARNING:
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Bill.
CONTENTS
Passage History
Purpose
Background
Main Provisions
Concluding Comments
Endnotes
Contact Officer & Copyright Details
Passage History
Agriculture, Fisheries and Forestry
Legislation Amendment Bill (No.2)
2004
Date
Introduced: 23
June 2004
House: House of Representatives
Portfolio: Agriculture, Fisheries and
Forestry
Commencement:
The operative provisions
of the Bill commence on Royal Assent. Some technical provisions
commence retrospectively.
The purpose of this Bill is to
amend the Australian Meat and Live-stock Industry Act 1997
(the AMLI Act) to allow the declaration of a marketing body and a
research body dedicated to the live-stock export sector of the
live-stock industry. These bodies would then be able to receive
revenue derived from compulsory charges applied to the live-stock
export industry from time to time. This will give effect to a
recommendation of the Livestock Export Review (Keniry Report).
The live-stock export industry reached a value of over $1
billion in 2002. Activity has eased subsequently due to a number of
factors, but the industry remains of significance.(1) In
2002-2003 live-stock exports represented about 3% of the gross
value of agricultural production. In gross value terms the industry
was similar to sugar cane and worth slightly more than the poultry
and cotton industries.(2)
It is also significant to note the relative importance of the
live-stock export industry as an aspect of the red meat industry.
In the 5 years to 2002, the total value of red meat exports
averaged around $5 billion each year. All live cattle, sheep and
goat exports combined constituted around $1 billion on average each
year.(3)
A review of the livestock export industry (the Review) was
announced on 10 October 2003 by the Minister for Agriculture,
Fisheries and Forestry. This followed the events surrounding the
voyage of the Cormo Express and its cargo of 54,000 live
sheep. The shipment was rejected in Saudi Arabia and eventually
unloaded in Eritrea at a cost to the Government of about $10
million.(4)
A number of recommendations were made by the Review. On 30 March
2004 the Minister for Agriculture, Fisheries and Forestry announced
that the Government had accepted most of the recommendations in
full and the remainder with modification. Most of the legislative
changes required to give effect to the Government s response to the
Review are contained in the Agriculture, Fisheries and Forestry
Legislation Amendment (Export Control) Bill 2004.(5)
The amendments contained in this Bill are designed to give
effect to the second aspect of Recommendation 2 of the Review, that
is:
Industry should be responsible for research and
development and management of quality assurance systems to support
its members translate best practice standards into outcomes
consistent with best practice:
-its activities should be funded by compulsory
levies.(6)
Section 60 of the AMLI Act currently allows the Minister to
declare a body to be the marketing body for the meat and live-stock
industry and to declare a body to be the research body for the meat
and live-stock industry. Subsection 60(3) permits the Minister to
declare the same body to be both the marketing body and the
research body, but expressly prohibits the declaration of more than
one marketing body or more than one research body at any one time.
The amendments made by this Bill to the AMLI Act will allow the
declaration of a marketing body or a research body for the
live-stock export sector of the industry in addition to the
marketing body or research body for the meat and live-stock
industry generally. This will enable the live-stock export sector
of the industry to take more responsibility for marketing and
research relating to the requirements of that sector of the
industry.
The research body for the meat and live-stock industry currently
receives funding on two bases (under sections 64 and 66 of the AMLI
Act). Funding under section 64 of the AMLI Act relates to
compulsory charges imposed on the industry under customs and excise
legislation. Funding under section 66 relates to the Commonwealth
matching funds expended by the research body on specified purposes
(principally research and development).
Under section 64 of the AMLI Act the Commonwealth is required to
pay to the research body amounts equal to levies received by the
Commonwealth under various provisions of the Primary Industries
(Excise) Levies Act 1999 and charges received by the
Commonwealth under various provisions of the Primary Industries
(Customs) Charges Act 1999 (the Customs Charges Act).
The live-stock export sector is currently not required to pay
compulsory levies. Provision for charges under the Customs Charges
Act has been made but the rate has been set at zero.(7)
Instead funding for research and marketing has been obtained from
voluntary contributions. The recommendation of the Keniry Report
that activities of the live-stock export research body be funded by
compulsory charges is to be given effect through amendment of the
relevant regulations.
Section 66 of the AMLI Act requires the Commonwealth to pay
amounts to the research body that are determined by reference to
the amounts paid by that body for industry research and development
purposes and other specified purposes. These are referred to in the
industry as matching funds (the amounts to be paid by the
Commonwealth are one-half of the amounts paid out by the research
body for research and other specified purposes, so ultimately
one-half of the total cost is met by the research body and one-half
by the Commonwealth).
Under the Bill matching funds will continue to be directed to
the industry research body (and not to the live-stock export
research body). The Explanatory Memorandum states that this:
reflects an industry position that the most
appropriate body for coordinating the delivery of research activity
on behalf of the industry remains MLA [Meat and Live-stock
Australia]. The Bill will therefore provide that MLA, or the body
determined to be the industry research body, will be the only body
eligible to receive Commonwealth matching funds for
research.(8)
Items 1 to 4 of
Schedule 1 insert in section 58 of the AMLI Act
definitions of industry marketing body , industry research body ,
live-stock export marketing body and live-stock export research
body . These facilitate the distinction between the body or bodies
that will deal with marketing and research for the live-stock
industry generally and the body or bodies that will deal with
marketing and research for the live-stock export sector of the
industry.
Item 7 of Schedule 1 inserts
provisions in section 60 of the AMLI Act that allow the Minister to
declare a body to be the live-stock export marketing body or the
live-stock export research body. The Minister can declare a body to
be both the live-stock export marketing body and the live-stock
export research body. However, the Minister cannot declare one
organisation to be not only the live-stock export marketing body
and/or the live-stock export research body, and also the industry
marketing body and/or the industry research body.
Item 10 of Schedule 1 inserts
criteria of which the Minister must be satisfied in order to
declare a body to be the live-stock export marketing body or the
live-stock export research body. These mirror the criteria that
currently apply to the declaration of a body as the marketing body
or the research body for the overall live-stock industry.
Item 21 of Schedule 1 inserts
new sections 64A and 64B into the
AMLI Act. These provide for amounts of charge received by the
Commonwealth from the live-stock export industry (under the Customs
Charges Act) to be paid to the live-stock export marketing body and
the live-stock export research body.
Item 23 of Schedule 1 converts
references in section 66 of the AMLI Act to the research body to
references to the industry research body .
Item 26 of Schedule 1 inserts
new subsections 67(3) and 67(3B)
into the AMLI Act. These provisions restrict the purposes for which
the live-stock export marketing body and the live-stock export
research body may spend money received from the Commonwealth under
sections 64A and 64B. These restrictions mirror those currently
imposed on the marketing body and the research body for the
industry generally.
Items 31 to 64 of
Schedule 1 amend the Customs Charges Act to
reflect the fact that amounts collected by the Commonwealth under
this Act that were previously paid to the marketing body for the
industry and the research body for the industry will now be paid to
the live-stock export marketing body and the live-stock export
research body.
New section 64A will provide for amounts of charge received by
the Commonwealth from the live-stock export industry to be paid to
the live-stock export research body. Section 66 of the AMLI Act
currently provides for payment by the Commonwealth to the research
body for the industry of additional amounts ( matching funds )
determined primarily by reference to the amounts expended by the
research body on research. Under the Bill matching funds will be
payable only to the industry research body. That is, they will not
be payable to the live-stock export research body for amounts
expended by that body on research. This will have the effect that
if the live-stock export research body expends moneys on research
directly (rather than via the industry research body) the
Commonwealth will not be required to pay matching funds in relation
to that research. The Explanatory Memorandum appears to suggest
that there is an expectation that the live-stock export research
body would arrange for research through the industry research
body;(9) however this is not required by the
legislation.
Where the live-stock export research body arranges for research
through the industry research body, the amounts payable by the
Commonwealth will be determined by reference to amounts paid out by
the industry research body, not by reference to amounts paid by the
live-stock export research body to the industry research body. It
is not clear what, if any, difference this distinction would make
in practice.
-
The scope and nature of the live animal export industry are
outlined in Peter Hicks and Jerome Davidson, Agriculture, Fisheries
and Forestry Legislation Amendment (Export Control) Bill 2004
Bills Digest, no.165, Parliamentary Library, Canberra,
2003-04. http://www.aph.gov.au/library/pubs/bd/2003-04/04bd165.pdf
(site visited 20 July 2004).
-
ibid p. 1.
-
J Keniry et al Livestock Export Review A Report to the
Minister for Agriculture, Fisheries and Forestry, 23 December 2003
p. 13.
http://www.daff.gov.au/content/publications.cfm?Category=Animal%20fixand%20Plant%20Health&ObjectID=056153D8-2885-4ACD-9A0BF0E15B1B6DDB
(site visited 20 July 2004).
-
The events surrounding the voyage of the Cormo Express are
summarised in Hicks and Davidson, op. cit. pp. 3-4.
-
The Digest in respect of this Bill (Hicks and Davidson,
op. cit.) is available at http://www.aph.gov.au/library/pubs/bd/2003-04/04bd165.pdf
(site visited 20 July 2004).
-
Keniry op. cit. p. 38.
-
ibid. pp. 2-3.
-
Explanatory Memorandum p. 3.
-
ibid. p. 3.
Jennifer Nicholson
28 July 2004
Bills Digest Service
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ISSN 1328-8091
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