Chapter 1
Introduction and background to the inquiry
Terms of reference
1.1
On 19 August 2009 the Senate referred the following matter to the Rural
and Regional Affairs and Transport References Committee for inquiry and report
by 14 September 2009:
The Australian Government’s management of the removal of the
40 per cent fee rebate for the Australian Quarantine and Inspection Service
(AQIS) export certification functions, having regard to:
-
the
level of industry support for the removal of the 40 per cent rebate prior to
the implementation of comprehensive reform of AQIS’s export inspection and
certification services;
-
the
adequacy of consultation by the Government in the development of industry work
plans;
-
the
capacity of the Government, including AQIS, to implement efficiency proposals;
-
the
adequacy of government funding to implement industry work plans;
-
any
progress on meeting targets in industry work plans;
-
the
financial or other impact on industry sectors of the failure to meet reform
targets; and
-
any
other relevant matter.
Conduct of the inquiry
1.2
The inquiry was advertised in The Australian newspaper on
Wednesday, 26 August 2009 and on the internet. In addition to relevant government
agencies and departments, the committee invited a number of key stakeholder
groups and individuals to provide a submission.
1.3
The committee received 29 submissions to the inquiry, listed in Appendix
1. The committee held public hearings in Canberra on Thursday 10 and Friday 11
September 2009. For a full list of witnesses please refer to Appendix 2.
1.4
All relevant submissions for the inquiry and the Hansard transcripts of
the committee's hearings are available on the Australian Parliament's homepage
at http://www.aph.gov.au.
Background
1.5
Since 2001, the Australian Government has provided a 40 per cent
contribution toward the cost of providing export inspection and certification
services to the meat, grain, fish, dairy, live animal and horticultural export
industries. In accordance with Government policy, the costs of the services
provided were met through:
1.6
The 40 per cent government contribution was calculated against revenues
received by AQIS from industry.
1.7
In December 2002, the Australian Government adopted a formal cost
recovery policy aimed at improving the consistency, transparency and
accountability of its cost recovery arrangements and promoting the efficient
allocation of resources. The underlying principle of the policy is that
"entities should set charges to recover all the costs of products or
services where it is efficient and effective to do so, where the beneficiaries
are a narrow and identifiable group and where charging is consistent with
Australian Government policy objectives."[2]
The Beale report
1.8
In early 2008, the Government commissioned an independent review of
quarantine and biosecurity arrangements which was conducted by a panel and
chaired by Mr Roger Beale, AO. The final report, One Biosecurity: A Working Partnership
(the Beale report) was released in December 2008. The Beale report proposed
significant changes to Australia's biosecurity system and recommended a
significant package of reforms, including that:
... export certification functions should return to 100 per
cent cost recovery as scheduled at the beginning of July 2009.[3]
1.9
In its preliminary response to the Beale Report, the Government noted
that:
In accordance with the principle of shared responsibility and
the Commonwealth's Cost Recovery guidelines, and as recommended in the report,
the 40 per cent certification subsidy will lapse as scheduled on 30 June 2009.
The report states that the 'policy objectives' for the subsidy are 'unclear'.
Across the board, industry will benefit from improved regulatory arrangements,
and more efficient allocation of resources, and increased resources.[4]
Cost recovery strategy
1.10
The strategy used by AQIS to transition industry sectors back to 100 per
cent cost recovery included:
-
early engagement;
-
application of the charges across as broad a base as possible;
-
improving the previous complex charging structure by directly
targeting the individuals that receive the AQIS service; and
-
using all Industry Consultative Committees (ICCs) to explore
medium term strategies as to how AQIS fees and charges can be reduced to offset
their impact.
Consultation
1.11
In addition to commencing consultation with ICCs, in April 2009, six
joint AQIS/Industry Ministerial taskforces were established to represent each
of the affected industry sectors – fish, grain, dairy, meat, horticulture and
live animal export. The six taskforces were consulted regarding the revised
fees and charges which would result from the lapsing of the Commonwealth's 40
per cent contribution and asked to identifying possible reforms to export
regulatory services and systems.
1.12
The seafood export industry was consulted on the changes through the
Seafood Exports Consultative Committee (SECC). SECC is made up of
representatives from key industry sectors and is the principal advisory forum
through which AQIS consults on issues arising from the management of
Australia's export strategies for fish and fish products.
1.13
Consultation with the grain industry was conducted through the AQIS
Grain Industry Consultative Committee (AGICC). The AGICC is made up of
representatives from a number of key stakeholders – more detailed membership
information is available at Appendix 3.
1.14
The dairy export industry was consulted through the Dairy Exports
Industry Consultative Committee (DEICC). The DEICC includes representation from
a number of key industry stakeholders and is the principal consultative forum
for AQIS and the dairy export industry to consult on all issues arising from
the management of Australia's export strategies for milk and milk products.
1.15
Consultation with the meat export industry on these changes occurred
through the Export Meat Industry Advisory Committee (EMIAC). The EMIAC is the
principal advisory forum for AQIS and the meat export industry to consult on
all issues arising from the management of Australia's export strategies for
meat and meat products. See Appendix 3 for more detail regarding the membership
of EMIAC.
1.16
The horticulture export industry was consulted on the changes through
the Horticulture Exports Consultative Committee (HECC). HECC is the principal
advisory forum for AQIS and the horticulture industry to consult on all issues
relating to Australian horticulture exports. Further information regarding
membership of the HECC is available at Appendix 3.
1.17
Consultation with the live animal export industry was through the
Livestock Exporters Industry Consultative Committee (LEICC). The LEICC is the
principal advisory forum for AQIS and the industry to consult on all issues
relating to Australian livestock exports. Membership of the LEICC is provided
at Appendix 3.
Acknowledgements
1.18
The committee appreciates the time and work of all those who provided
oral and written submissions to the inquiry. Their work has assisted the
committee considerably.
A note on references
1.19
References in this report are to individual submissions as received by
the committee, not to a bound volume. References to the committee Hansard are
to the proof Hansard: page numbers may vary between the proof and the official
Hansard transcript.
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