Chapter 2
Key issues
Introduction
2.1
This chapter outlines the key issues identified by submitters. Overall,
submitters to the inquiry welcomed the bill and supported the key elements of
the bill. As discussed in Chapter 1, many of these submitters also participated
in the references committee's inquiry into levies tabled in 2015, and through
that inquiry called for the establishment of a levy payer register for each
agricultural industry.[1]
The references committee responded to the evidence provided by submitters and
recommended the establishment of a levy payer register of the kind contained in
the bill. A small number of submitters raised concerns about aspects of the
bill. The committee has listened to these concerns and addressed them below.
General support for the bill
Benefits of creating a levy payer register
2.2
A large number of submitters outlined to the committee the many benefits
that would arise from the creation of a levy payer register. Support came from
both Research and Development Corporations and peak industry groups.
2.3
The Council for Rural Research and Development Corporations offered
strong support for the bill, submitting that:
The Council of Rural RDCs fully supports the principles of
open, transparent and accountable processes for informing and engaging with
levy payers. This Bill enables the establishment and use of levy-payer
registers which in turn will mean the RDCs can have accurate, up-to-date
information about levy payers. The Council supports the Bill being passed.[2]
2.4
NSW Canegrowers Council and Sunshine Sugar explained how the changes
proposed by the bill would benefit the sugar industry. While Sunshine Sugar and
all sugar cane growers in NSW pay a mandatory levy to Sugar Research Australia
(SRC), less than a third of these have membership in the SRC. The current
legislative framework permits SRC to deal only with its members. As a
consequence SRC is not able to share information directly with the majority of
levy payers. NSW Canegrowers Council Inc. and Sunshine Sugar submitted that:
This, in our view, significantly impedes their capacity to
effectively engage with their levy payers and to align research and investment
to industry priorities. We believe that the amendments as proposed would allow
SRA to better achieve its overall objectives resulting in improved returns to
our growers and contribute to a more profitable, competitive and sustainable
sugar cane industry in NSW.[3]
2.5
Sugar Research Australia (SRA) offered full support for the bill and
noted that the proposed reforms would enable SRA to properly consult with levy
payers and ensure that its planning and investment decisions align with the
needs of the industry. [4]
2.6
Grain Producers Australia, who have called for the measures contained in
the bill since 2013, described the proposed reforms as a 'key to providing
grain producers with a strong link' with the RDC.[5]
The Grains Research & Development Corporation also supported the bill in
general terms.[6]
2.7
The Cotton Research and Development Corporation (CRDC) explained that a
levy payer register would:
[S]trengthen CRDC's capacity to consult with cotton farmers
on their R&D priorities, improve the distribution and extension of research
results as well as receiving feedback on CRDC's performance.[7]
2.8
The Tasmanian Farmers and Graziers Association welcomed the bill,
submitting that giving 'RDCs access to producer information will increase the
ability of these bodies to distribute information in a more efficient and
timely manner'.[8]
2.9
Many other submitters provided similar praise for the measures contained
in the bill. [9]
Benefit of sharing de-identified
information with the Australian Bureau of Statistics
2.10
The Australian Bureau of Statistics (ABS) welcomed the bill, observing
that it 'has the potential to open up new opportunities for improving the
quality and availability of agricultural statistical information for the
benefit of both government and industry' and would support the Government's
Public Sector Data agenda.[10]
2.11
The Council for Rural Research and Development Corporations supported
the proposal to share information with the ABS, observing that:
High quality statistical information about agricultural
production in Australia and the number of active enterprises has also been an
issue of concern for some time. Making information available as appropriate to support
the functions of the Australian Bureau of Statistics, consistent with the
government’s Public Data Policy Statement, is also expected to help improve
this situation.[11]
2.12
Dr Lindsay Campbell of the Faculty of Agriculture and Environment at the
University of Sydney also supported the proposal to share
information with the ABS.[12]
Key issues
2.13
While the majority of submitters supported the changes proposed by the
bill, some submitters expressed concern with aspects of the bill, and a small
number rejected the bill altogether.
Request for further detail
2.14
Some submitters, while generally supportive of the bill, asked for
further detail. For example, more information was requested about: how the
information about levy payers might be shared by peak industry bodies and
councils; the degree of consultation required by RDCs; and the method by which levy
payer information would be collected.[13]
2.15
The department advised that it is working closely with RDCs and industry
representative bodies to develop detailed guidance so that the agricultural
industry would have explicit guidance on how the levy payer database can be
used, how the data should be stored and protections that should be in place.[14]
2.16
The committee considers that these details that would be worked through
by the department with stakeholders as the administrative arrangements are
established following passage of the bill through the parliament.
Expansion of the scope of the bill
2.17
Dr Lindsay Campbell suggested that the bill could go further and enable
RDCs to share levy payer information with each other and the ABS. This would be
particularly useful given that most farms in South Australia are mixed
enterprise farms.[15]
2.18
Grain Producers Australia and Australian Macadamia Society, among
others, called for levy payer information to be shared on an ongoing basis, to
ensure that the levy payer register is always up-to-date.[16]
This would be particularly useful in the case of a biosecurity emergency.
2.19
The department advised that it anticipates levy payer information would
be distributed to eligible recipients annually. However, the timing would 'be
negotiated with each of the RDCs as a levy payer register is established'.[17]
The bill in its current form does not anticipate sharing data between RDCs,
however the ABS would be able to disaggregate data between different RDCs.
Privacy concerns
2.20
Some submitters expressed concern at the impact the bill could have on personal
privacy.[18]
FLAG Australia submitted that disclosure of personal or corporate levy payer
information should not occur without the prior permission of the levy payer.[19]
WA Farmers similarly called for levy payers to be able to opt out of disclosure
to the ABS.[20]
2.21
The department advised the committee that it has commenced consultation
with RDCs and industry representative bodies to develop detailed guidance to
provide clarity on 'how the data can be used, who can use it and for what
purpose'.[21]
In particular, this guidance would:
...set out the governance arrangements for how the data is
stored, used and protected in line with the Australian Privacy Principles. It
will also be informed by the existing arrangements and experience from the two
RDCs (Australian Wool Innovation and Dairy Australia) that already have levy
registers in place.[22]
2.22
The department informed the committee that it is working on governance
principles to ensure that personal information is protected. These principles
are likely to include:
-
protection of commercial-in-confidence information and personal
information in accordance with the Australian Privacy Principles and common law
confidentiality;
-
provision of data to recipients only for permitted purposes on a
case-by-case basis;
-
information provided to an industry representative body must be
store the contact details separately to the membership contact list (to prevent
the use of the list for non-permitted purposes); and
-
levy payers who are contacted by industry representative bodies
must have the option to easily opt out of receiving further communications.[23]
2.23
The ABS specifically addressed privacy concerns, explaining its
established track-record of protecting personal information:
In accessing and using the levy data to generate agricultural
statistics, ABS will draw on its strong established culture of protecting the
data that it holds, which is further supplemented by legislative obligations
under the Privacy Act 1988 and the Census Statistics Act 1905 to
protect information from misuse and unauthorised access or disclosure.
In conclusion, the ABS supports the proposed amendments to
the legislation. As an organisation with significant expertise in working with
administrative date and a long history of protecting the confidentiality and privacy
of respondent's data, ABS is well-positioned to draw the value out of this data
in a safe way for both government and industry.[24]
2.24
The explanatory memorandum states that where the Secretary has approved
secondary disclosure of levy payer information to an industry representative
body, the 'administrative arrangements will enable levy payers to choose to
opt-out and not receive information'.[25]
2.25
The committee considers that the measures proposed by the department and
the ABS's experiences in handling personal information are an adequate response
to the privacy concerns raised. While it is reasonable to allow levy payers to
opt out of communications from industry representative bodies, it would defeat
the purpose of the bill to enable levy payers to opt out of communications from
the relevant RDC.
Use of levy payer information for
political purposes
2.26
A few submitters rejected the proposal for the Secretary to authorise
disclosure of levy payer information to third parties, particularly to peak
industry bodies. These submitters feared that levy payer information may be
used by peak industry bodies for the purpose of conducting political campaigns.
For example, FLAGS Australia expressed concern that peak industry bodies could
misuse the levy payer register for this purpose.[26]
United Stockowners of Australia expressed similar concerns, specifically about
the Cattle Council of Australia.[27]
2.27
As discussed in Chapter 1, clause 27B of the bill sets out the purposes
for which an eligible recipient would be able to use levy payer information
provided to it under clause 27(1) of the bill. This clause does not include
political purposes. Any use of levy payer information would be in contravention
of the proposed clause. The explanatory memorandum specifically states that the
bill 'does not provide for levy payer information to be used for agri-political
purposes'.[28]
Cost of creating a levy payer
register
2.28
Voice of Horticulture and others sought further information about the costs
of establishing a levy payer register.[29]
2.29
The department noted that each RDC would need to consider the potential
benefits against the 'significant investment that is required'.[30]
Evidence presented to the References Committee earlier in this Parliament
suggested that for some RDCs the creation of a levy payer register would be
relatively inexpensive and straight forward.[31]
Of course this would not be the case for all RDCs, the proposals contained in
the bill offer RDCs the opportunity to create a levy payer register. There is
no obligation to do so.
Concerns by some peak industry
groups
2.30
While many peak industry supported the bill[32],
others rejected the measures proposed and submitted that if passed, the changes
would diminish the important role that peak organisations perform as a conduit
between levy payers and RDCs.
2.31
For example, in the view of Onions Australia, organisations like itself
have been elected as representatives by levy payers who do not wish to deal
with RDCs. Onions Australia reported that it was 'extremely concerned' by the
proposed amendments to permit the department to provide levy and charge payer
information to RDCs for the purposes of developing levy payer registers.[33]
Similar concerns were expressed by the Voice of Horticulture and AusVeg.[34]
2.32
The committee recognises the important role that peak organisations
perform, particularly in providing a link between levy payers and RDCs.
However, the purpose of the bill is not to diminish the role of peak
organisations. Rather, the bill is directed at giving levy payers more of a say
about how their levy funds are spent. To achieve this goal, RDCs need to know
who their levy payers are.[35]
Concerns of the Australian Dairy
Farmers and Dairy Australia
2.33
Australian Dairy Farmers and Dairy Australia supported the general
policy objective of the bill. However, both organisations rejected the proposed
constraints on the Dairy Australia's disclosure of levy payer information.[36]
The Dairy Produce Act 1986 (Cth) does not currently contain any
restrictions on the secondary disclosure of information. The submission called
for amendments to the proposed secondary disclosure provisions to 'avoid
introducing inefficiencies and restrictions in current operational activities'.[37]
The submission identified two circumstances where Dairy Australia does not
currently need to request permission from the Secretary, disclosure to:
-
a share registry in order to compile voting entitlements for an
Annual General Meeting; and
-
a third party for an operational purposes, such as to a
mailhouse, in order to update levy payers.[38]
2.34
The dairy industry was also concerned that clause 27B(6) of the bill
might limit the Secretary's ability to authorise disclosure:
Under the new regime it would not be possible for Dairy
Australia to disclose information to third parties without the consent of the
Secretary of the Department. If consented to, a third party could then use the
information for one of the purposes permitted under new section 27B(6). There
is no provision for the Secretary to permit additional uses not listed in
section 27B(6), for example a share registry using the information for the
purposes of determining voting entitlements for an AGM.[39]
2.35
The Explanatory Memorandum explicitly deals with the dairy industry's
concern about secondary disclosure in relation to clause 27B(6), noting that
the secretary may permit disclosure: 'of information to an information
technology company engaged by an RDC for data management services, or to an
industry representative body for consulting levy payers on R&D plans or
demonstrating industry support for a levy proposal'.[40]
The explanation suggests that it would be open to the Secretary to approve
disclosure for the purposes of a kind that Dairy Australia is likely to want to
disclose to a third party.
2.36
The committee considers that that the proposed changes do not impose an
unreasonable limitation on Dairy Australia's disclosure of levy payer
information. Dairy Australia would simply be required to request approval from
the Secretary in order to disclose levy payer information to a third party.
This is a reasonable limitation and would ensure that all RDCs are subject to
the same constraints in relation to the use of levy payer information.
Lack of penalties within the bill
2.37
Some concern was expressed about the absence of penalties in the bill
for misuse of levy payer information. For example, if the database were used
for a political campaign.[41]
2.38
The department submitted that compliance with the limitations on the use
of levy payer data contained in the bill could be achieved by a robust
governance framework. The department provided two examples of 'alternative
mechanisms' to encourage compliance:
This could include, for example, incorporating requirements
in the government's individual RDC funding agreements or, in the case of misuse
by an industry representative body, the option of pursuing legislative and
regulatory change to remove the body's legislated role in the research and
development system.[42]
Consultation
2.39
Some submitters were dissatisfied with the level of consultation undertaken
by the department. [43]
For example, Cotton Australia submitted that:
The levy system is built on a strong partnership between the
Australian Government and our levy paying growers, so we are disappointed that
this Bill which introduces significant, although not unwelcome changes to our
industry, was not subject to consultation with ROs [Representative
Organisations].[44]
2.40
The department's submission does not outline the consultation process it
followed in developing the bill. However, the proposed measures enjoy
widespread support, and were considered by the references committee during its
earlier inquiry. The bill provides a high level framework to enable the establishment
of levy payer registers and most of the detail would be in the administrative
arrangements. The department has advised that it 'has started consulting with
RDCs and industry bodies' in relation to the development of detailed guidance
for these organisations.[45]
The committee trusts that the department would continue to focus on
consultation with relevant stakeholders as it works to implement the bill – if
passed – and associated administrative arrangements.
Committee view
2.41
The changes proposed by the bill would enable Research and Development
Corporations (RDCs) to better communicate with all levy payers in a particular
industry, not just those growers who are members of the RDC. The ABS would also
have access to de-identified data. This bill is the first step toward improving
the systems governing levies in the agriculture sector.
2.42
The committee is pleased to see that the government has given close
attention to the Senate Rural and Regional Affairs References Committee report into
the industry structures and systems governing the imposition and disbursement
of marketing and research and development levies in the agriculture sector,
tabled in June 2015.[46]
In particular, the committee is delighted that recommendation 1 of that report is
encapsulated by the bill.
2.43
That report was presented to the Senate on 30 June 2015. The government
is required to table a response to parliamentary reports of this kind within
three months of presentation. The government still has not responded to the references
committee's report. The committee looks forward to further action by the
government in response to the references committee's six other recommendations.[47]
2.44
The committee notes that submitters to this inquiry overwhelmingly
support the bill. Some issues of concern have been raised by some submitters, for
the reasons outlined above, the committee accepts the evidence of the
department that they will be resolved in due course. The committee also notes
the department's undertaking to continue to consult with stakeholders. The
committee welcomes this assurance and will monitor the department's
implementation of the new administrative and legislative framework, if the bill
is passed.
Recommendation 1
2.45
The committee recommends that the Senate pass the bill.
Recommendation 2
2.46
The committee recommends that the Department of Agriculture and Water
Resources continue to consult with Research and Development Corporations and
representatives of the agricultural industry as it implements the regulatory
and administrative framework associated with the measures contained in the
bill.
Recommendation 3
2.47
The committee recommends that the Minister for Agriculture and Water
Resources table a response to the Senate Rural and Regional Affairs and
Transport References Committee's report tabled in June 2015: Inquiry into the
industry structures and systems governing the imposition and disbursement of
marketing and research and development levies in the agriculture sector.
Senator Bill
Heffernan
Chair
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