Chapter Two

Background

Australia's current approach to biosecurity and quarantine

2.1        The terms of reference for the inquiry required the committee to examine the adequacy of Australia's current biosecurity and quarantine arrangements, including the adequacy of resourcing. The following chapter outlines Australia's existing administrative and legal arrangements in relation to biosecurity and quarantine. The chapter also provides a brief overview of Australia's current approach to managing the risk of incursions of exotic pests and diseases.

National administrative and legal arrangements for biosecurity and quarantine

2.2        The Department of Agriculture, Fisheries and Forestry's (DAFF) Import risk analysis handbook 2011 (the risk analysis handbook) notes that the objective of Australia's biosecurity and quarantine measures is:

...the prevention or control of the entry, establishment or spread of pests and diseases that could cause significant harm to people, animals, plants and other aspects of the environment.[1]

2.3        The Commonwealth does not have exclusive power under the Constitution to make laws in the area of biosecurity and quarantine. The administration of Australia's biosecurity and quarantine is, therefore, governed by both Commonwealth and state and territory laws. The states and territories are, for example, responsible for the intra- and inter-state movement of goods of quarantine concern.

2.4        The Commonwealth's quarantine laws are contained in the Quarantine Act 1908 (the Quarantine Act) and associated subordinate legislation, including the Quarantine Regulations 2000 and the Quarantine Proclamation 1998. The proclamation identifies goods which cannot be imported into Australia unless the Director of Animal and Plant Quarantine grants an import permit or unless they comply with other specified conditions.[2]

2.5        The Biosecurity Services Group (BSG) in DAFF is responsible for Commonwealth biosecurity policy development and the establishment of risk management measures. DAFF is also responsible (through Biosecurity Australia) for undertaking risk analyses.

2.6        The BSG was formed on 1 July 2009 in response to the Beale Review,[3] which recommended the consolidation of the biosecurity activities of the Australian Quarantine and Inspection Service (AQIS), Biosecurity Australia (BA) and the Product Integrity, Animal and Plant Health division of DAFF.[4]

Managing biosecurity risks

2.7        DAFF describes the Government's approach to managing the risk of incursions of exotic pests and diseases as "multi-layered" in that it involves a series of "complementary measures applied along the biosecurity continuum – offshore, at the border and onshore".[5]

2.8        Offshore (or pre-border) activities are described as those which seek to prevent biosecurity risks reaching Australia. In addition to understanding global risks, working with international trading partners and the private sector and engaging with travellers about Australia's biosecurity requirements, specific offshore activities include:

• participation in international standard-setting bodies;
• co-operation in multilateral forums;
• development of offshore quarantine arrangements;
• undertaking of risk analyses; and
• intelligence gathering and audit activities.[6]

2.9        AQIS is responsible both for the making of quarantine decisions under the Quarantine Act and for the development of border operational procedures.

2.10      Border activities seek to intercept biosecurity risks that present at airports, seaports, mail centres and along Australia's coastline. Activities are therefore centred around the screening of mail, vessels (including aircraft), people and goods entering the country. Border activities also include:

• import permit decisions;
• audit activities; and
• post-entry quarantine.[7]

2.11      In the event that there is an incursion of a pest or disease of biosecurity risk, Australia's onshore arrangements aim to reduce the likelihood that the pest or disease will become established. Formal national arrangements exist for managing responses to both emergency animal and plant pests and diseases and food safety issues in aquatic and terrestrial environments. Onshore (or post-border) activities include:

• monitoring and surveillance activities (for exotic animal and plant pests and diseases);
• development of emergency response plans; and
• coordination of national responses to pest and disease incursions.[8]

Appropriate Level of Protection

2.12      The World Trade Organisation (WTO) Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement) underpins the biosecurity approaches of many WTO members, including Australia. The SPS Agreement defines the concept of an 'appropriate level of sanitary and phytosanitary protection' (ALOP) as:

...the level of protection deemed appropriate by a WTO member establishing a sanitary or phytosanitary measure to protect human, animal or plant life or health within its territory.[9]

2.13      Australia expresses its ALOP in qualitative terms, and the risk analysis handbook states that Australia maintains a "conservative, but not a zero-risk, approach to the management of biosecurity risk".[10] The Commonwealth, with the agreement of all state and territory governments, has described Australia's ALOP as:

...providing a high level of sanitary and phytosanitary protection aimed at reducing risk to a very low level, but not to zero.[11]

2.14      This approach is identified as being consistent with the international standards established by the SPS Agreement.[12]

2.15      In setting an ALOP, WTO members are required to take into account "the objective of minimising negative trade effects".[13] The risk analysis handbook notes that, in conducting risk analyses, Australia takes into account the following economic factors:

• the potential damage in terms of loss of production or sales in the event of the entry, establishment or spread of a pest or disease in the territory of Australia;
• the costs of control or eradication of a pest or disease; and
• the relative cost-effectiveness of alternative approaches to limiting risks.[14]

The risk assessment process

2.16      The undertaking of a risk analysis in relation to a proposed importation (or where new circumstances arise in relation to an existing importation) is a critical element of Australia's biosecurity and quarantine framework. The risk assessment handbook explains:

Within Australia's quarantine framework, the Australian Government uses risk analyses to assist it in considering the level of quarantine risk that may be associated with the importation or proposed importation of animals, plants or other goods.[15]

2.17      In conducting a risk analysis, BA:

• identifies the pests and diseases of quarantine concern that may be carried by the good/s;
• assesses the likelihood that an identified pest or disease or pest would enter, establish or spread; and
• assesses the probable extent of the harm that would result.[16]

2.18      If the assessed level of quarantine risk exceeds Australia's ALOP, BA then considers whether any risk management measures could reduce quarantine risk to achieve the ALOP. If there are no risk measures that reduce the risk to an appropriate level, the importation of the good in question is not allowed.

Types of risk analysis

2.19      On receiving an import proposal (or notification of a change to the risk profile of existing trade in a good), BA considers whether a risk analysis is required. A risk analysis may take the form of:

• a non-regulated analysis of existing policy or technical advice to AQIS; or
• an import risk analysis (IRA), in which the key steps of the analysis are regulated under the Quarantine Regulations 2000.[17]

2.20      A non-regulated analysis of existing policy could take the form of, for example, a pest risk analysis or a relatively narrow course of consultation with relevant stakeholders.[18] This approach could be taken where, for example, BA has previously undertaken significant analysis in relation to the crop that is the subject of an import proposal.

2.21      The Chief Executive of BA determines whether a risk analysis will be conducted as an IRA. An IRA will generally be undertaken when:

• relevant risk management measures have not been established; or
• relevant risk management measures for a similar good and pest/disease combination do exist, but the likelihood and/or consequences of entry, establishment or spread of pests or diseases could differ significantly from those previously assessed.[19]

2.22      An IRA can be undertaken in either a 'standard' or 'expanded' format. The regulated steps for both types of IRA's include:

• consultation – on scope and approach with the proposer, industry and other stakeholders;
• announcement and commencement – which triggers the regulated timeframe for the IRA;
• issues paper preparation – expanded IRA only;
• consultation on issues paper – expanded IRA only;
• risk analysis and draft IRA report preparation;
• consultation on draft IRA report – through publication on the BA website and an invitation for public comment;
• review of draft report by the Eminent Scientists Group (ESG)[20] – The ESG is a high level review group, independent from BA that is tasked with providing external scientific and economic scrutiny of expanded IRAs. The ESG is required to take into account any relevant new information and to assess conflicting scientific views to ensure that:

-          all submissions received from stakeholders in response to the draft IRA report have been properly considered;

-          all relevant matters relating to the likely economic consequences of a pest or disease incursion have been properly considered; and

-          the conclusions of the revised draft IRA report are scientifically reasonable, based on the material presented;

• preparation and publication of the provisional final IRA report – taking into account stakeholder comments and, in the case of an expanded IRA, any recommendations made by the ESG;
• appeal on the provisional final IRA report – a right of (non-judicial) appeal is available to the Import Risk Analysis Appeals Panel (IRAAP) for any stakeholder who believes there was a 'significant deviation from the [prescribed] IRA process...that adversely affected their interests';[21]
• provision of final IRA report and recommendation – for a policy determination to the Director of Animal and Plant Quarantine;
• determination by the Director of Animal and Plant Quarantine – the determination provides a policy framework for decisions on whether or not to grant an import permit and any conditions that may be attached to a permit. In making the determination, the Director considers:

-          the final IRA report and its recommendations;

-          the outcome of any appeals;

-          the ESG report;

-          BA's response to the ESG report; and

-          any other relevant information, including Australia's international rights and obligations.[22]

2.23      The steps outlined above reflect a number of changes to the IRA process that were introduced in 2007 to:

• increase its transparency and timeliness;
• regulate key steps, such as timeframes for completing IRAs; and
• enhance consultation with, and scientific scrutiny of IRAs by the ESG.[23]

Emergency Animal Disease Response Agreement

2.24      In Australia, animal health emergencies are coordinated nationally, with responses underpinned by the Emergency Animal Disease Response Agreement (EADRA) which was ratified in March 2002.[24] The EADRA was developed to facilitate rapid responses to, and control and eradication or containment of certain animal diseases (Emergency Animal Diseases or EADs). Under the EADRA, the costs of responding to EADs are shared by the affected parties, including the Commonwealth, all state and territory governments and livestock industries.[25]

2.25      The current EADRA is an agreement between the peak body, Animal Health Australia (AHA),[26] the Commonwealth government, all state and territory governments and the following industry signatories:

• Australian Chicken Meat Federation Inc;
• Australian Egg Corporation Limited;
• Australian Dairy Farmers Limited;
• Cattle Council of Australia Inc;
• Australian Pork Limited;
• Sheepmeat Council of Australia Inc;
• WoolProducers Australia;
• Australian Lot Feeders' Association Inc;
• Goat Industry Council of Australia;
• Australian Honey Bee Industry Council Inc;
• Australian Racing Board Limited;
• Harness Racing Australia Inc;
• Australian Horse Industry Council; and
• Equestrian Australia Limited.[27]

2.26      Under the terms of the EADRA, signatories are required to commit to:

• minimising the risk of EAD incursions by developing and implementing biosecurity plans for their jurisdictions of industries;
• maintaining capacity to respond to an EAD by having available adequate numbers of trained personnel to fill roles specified in AUSVETPLAN;
• participating in decision making relating to EAD responses, through representation on the Consultative Committee on Emergency Animal Diseases (CCEAD) and a National Management Group (NMG); and
• sharing the eligible response costs of EAD incursions.[28]

2.27      The terms of the EADRA include an agreement from the Commonwealth to underwrite the costs of an emergency response to an EAD. In the event of an emergency, however, industry signatories to the EADRA must have in place plans to meet their obligations under the agreement. The proportion of signatories' payments depend on the disease category.[29]

2.28      There are four disease categories which determine the proportions paid by government and industry (see Table 1).

Table 1 - EADRA – Disease Categories[30]

Category of Disease	Cost Share
Category 1: EADs that predominantly seriously affect human health and/or the environment (depletion of native fauna) but may only have minimal direct consequences to the livestock industries.	100% government funding
Category 2: EADs that have the potential to cause major national socio-economic consequences through very serious international trade losses, national market disruptions and very severe production losses in the livestock industries that are involved. This category includes diseases that may have slightly lower national socio-economic consequences, but also have significant public health and/or environmental consequences.	80% government funding 20% industry funding
Category 3: EADs that have the potential to cause significant (but generally moderate) national socio-economic consequences through international trade losses, market disruptions, involving two or more states and severe production losses to affected industries, but have minimal or no affect on human health or the environment.	50% government funding 50% industry funding
Category 4: These are EADs that could be classified as being mainly production loss diseases. While there may be international trade losses and local market disruptions, these would not be of a magnitude that would be expected to significantly affect the national economy. The main beneficiaries of a successful emergency response to an outbreak of such a disease would be the affected livestock industry(s).	20% government funding 80% industry funding

Cost of Disease Response

2.29      The cost to industries of a disease response is determined in relation to their Gross Value of Production (GVP). The government costs for a response is shared – 50 per cent by the Commonwealth – and the remainder shared between the state and territory governments.

National Management Group

2.30      The National Management Group (NMG) is the decision making body that determines whether to respond to an animal disease, and the direction of that response. The NMG has two primary functions:

• to consider EAD response issues; and
• to consider general issues around the EADRA (including regular reviews of the agreement).[31]

2.31      In the event of an EAD response, the NMG will be made up of a representative of each of the affected parties:

• the Secretary of DAFF (Chair)
• the CEOs of the state and territory government departments;
• the President/Chairman of each of the relevant industry parties; and
• AHA (as an observer).

2.32      The NMG is responsible for:

• approving the EAD response plan (including an indicative budget);
• reviewing the EAD response plan when it believes the cost may exceed the agreed limit (1 per cent of the GVP of the affected industry(s) – 2 per cent for Foot and Mouth Disease); and
• determining whether a party has acted appropriately in the matter of reporting an EAD in the first place.

Consultative Committee on Emergency Animal Diseases

2.33      The Consultative Committee on Emergency Animal Diseases (CCEAD) is the key technical coordinating body for animal health emergencies.[32]

2.34      The CCEAD provides the link between the Commonwealth, states and territories, industry and AHA. The members of the CCEAD are:

• the Australian Chief Veterinary Officer (who chairs the CCEAD);
• all state and territory Chief Veterinary Officers (or their nominees);
• one representative nominated by CSIRO Animal Health;
• one representative of AQIS nominated by the Australian Chief Veterinary Officer;
• one representative nominated by BA;
• one representative of AHA as an observer; and
• members of the relevant industry parties (generally including one member representing a non-affected industry).

2.35      Under the EADRA, the CCEAD has the following responsibilities:

• assessment of EAD Response Plans submitted by affected jurisdictions (in order to advise the NMG whether they should be approved);
• provision of advice regarding whether an EAD can be eradicated or contained;
• monitoring of progress in relation to the response and provision of regular updates to affected parties and the NMG;
• determining when a disease has been contained or eradicated under an EAD Response Plan; and
• recommending when 'proof of freedom' has been achieved.

Emergency Plant Pest Response Deed

2.36      The eradication of emergency plant pest incursions which pose a potential threat to Australia's agricultural industry is conducted in accordance with the National Emergency Preparedness and Response Plan (the response plan). The response plan specifies the procedures for handling emergency plant pest incursions at the national, state, territory and district levels.[33]

2.37      Following the detection of an emergency plant pest and declaration of an outbreak, the Consultative Committee on Emergency Plant Pests (CCEPP) meets to determine the feasibility of eradication. The CCEPP is Australia's key technical body for co-ordinating national responses to emergency pest incursions and assessing the technical feasibility for their eradication. The CCEPP makes recommendations to the National Management Group (NMG), which is the decision making body that determines whether to proceed with an eradication campaign and, if so, approves the national cost sharing arrangements to fund the campaign. The NMG is made up of the following representatives:

• the Secretary of DAFF (Chair);
• the CEOs of the affected state and territory government departments;
• the President/Chairman of each of the affected industry parties; and
• Plant Health Australia (PHA) (as an observer).[34]

2.38      Funding for eradication campaigns is allocated under the Emergency Plant Pest Response Deed (EPPRD), a formal cost sharing agreement covering industry and government funding arrangements for the eradication of emergency plant pests. The current EPPRD, which came into effect on 26 October 2005, is an agreement between PHA, the Commonwealth government, all state and territory governments and the following plant industry signatories:

• Almond Board of Australia Inc;
• Apple and Pear Australia Limited;
• Australian Banana Growers' Council Inc;
• Australian Cane Growers' Council Ltd;
• Australian Dried Fruit Association Inc;
• Australian Honey Bee Industry Council Inc;
• Australian Macadamia Society Limited;
• Australian Mango Industry Association Ltd;
• Australian Olive Association Ltd;
• Australian Onion Industry Association Inc;
• Australian Plantation Products and Paper Industry Council;
• Australian Processing Tomato Research Council Inc;
• Australian Table Grape Association Inc;
• Australian Walnut Industry Association Inc;
• AUSVEG Ltd;
• Avocados Australia Ltd;
• Canned Fruit Industry Council of Australia Ltd;
• Cherry Growers of Australia Inc;
• Citrus Australia Ltd;
• Cotton Australia Ltd;
• Grain Producers Australia Ltd;
• Nursery and Garden Industry Australia Ltd;
• Queensland Fruit and Vegetable Growers Ltd;
• Ricegrowers Association of Australia Inc;
• Strawberries Australia Inc;
• Summerfruit Australia Ltd; and
• Wine Grape Gowers Australia Inc.[35]

2.39      Under the EPPRD, Emergency Plant Pests (EPPs) are determined to be in one of four 'Categories'. It is these 'Categories' which determine the cost sharing split between affected government and industry parties, based on the relative private and public benefits of eradication of the pest (see Table 2).

Table 2 – EPPRD cost sharing categories[36]

Category of disease	Cost share
Category 1: Large impact on the environment, human health or amenity flora values and relatively little impact on commercial crops	100% public funding
Category 2: Significant impact on amenity flora and/or environmental values and/or effects on households, or very severe regional and national economic impacts	80% public funding 20 % private funding
Category 3: Minor adverse impact on public amenities, households or the environment, and/or moderate trade implications and/or national and regional economic implications	50% public funding 50% private funding
Category 4: Primarily affects commercial cropping industries, with minor or no economic, trade or environmental impacts	20% public funding 80% private funding

2.40      If a national emergency response is agreed under the EPPRD, the Commonwealth pays 50 per cent of the government share in all instances, with the balance of the government share divided between the relevant states and territories.

2.41      Under the EPPRD the Commonwealth has agreed to initially meet an industry party's cost sharing obligation where that industry party is unable to do so. The Commonwealth's payment is made on the basis that the industry party will repay the Commonwealth within a reasonable period of time (generally no longer that ten years) using a pre-agreed funding mechanism, such as an EPP Response Levy.[37]

2.42      Parties to the EPPRD can establish an EPP Response Levy to meet financial liabilities for responses under the EPPRD. While this is not the only option, many industries have chosen this approach, as it provides the greatest flexibility in relation to adjusting levy rates to suit particular needs. Other options available include using funds held by the industry in trust accounts, voluntary levies or funds raised by other means.[38]

Committee view

2.43      The committee acknowledges that Australia's biosecurity system has, over some years, been the subject of a number of major reviews – starting with the 1995 review chaired by Professor Malcolm Nairn.[39]

2.44      The latest review, chaired by Mr Roger Beale, found that whilst Australia's "biosecurity system has worked well in the past, and is often the envy of other countries" ... "the system is far from perfect".[40] The Beale Report also noted that a number of systemic deficiencies have been exposed over recent years and concluded that there is certainly room for improvement.

2.45      The committee notes that a number of major reforms have been proposed by the Beale Report with the intention of strengthening Australia's biosecurity system. Proposed reforms include the revision of legislation, improved targeting of resources, more efficient timelines and operations, improved risk management and increased transparency.[41]

2.46      The committee agrees with the Beale Report's statement regarding the importance of developing a "seamless biosecurity system that fully involves all the appropriate players"[42] and notes that it has, over many years, stressed the importance of promoting an increased level of cooperation between all stakeholders; including trading partners, Commonwealth, state and territory governments, industry and the community.

2.47      The committee notes that, consistent with the Beale Review, DAFF is currently moving away from mandatory intervention targets and working toward a more risk-based strategy. The committee understands that in moving toward a risk based approach to biosecurity operations, resources will be focused on the risk of greatest biosecurity concern. The committee agrees, in principle, to DAFF pursuing a more risk-based approach to biosecurity. However, the committee also believes that it is vital that an appropriate level of resources continue to be allocated to maintain assurance on what DAFF describes as "lower-risk items and pathways".[43]

2.48       The committee understands that proposed new legislation to replace the Quarantine Act 1908 is close to finalisation. DAFF has indicated that the new Biosecurity Bill exposure draft and a consultation regulation impact statement is expected to be released in the first half of 2012. DAFF has also indicated that it is proposed that the new Biosecurity Bill will be introduced to Parliament in the second half of 2012. As previously noted, the committee is interested in conducting a detailed inquiry of the exposure draft and/or the new legislation.

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