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PRIMARY INDUSTRIES LEVIES AND CHARGES COLLECTION (NURSERY PRODUCTS) REGULATIONS (AMENDMENT) 1995 NO. 121
EXPLANATORY STATEMENTSTATUTORY RULES 1995 No. 121
Issued by the Authority of the Minister for Primary Industries and Energy
Horticultural Levy Act 1987
Primary Industries Levies and Charges Collection (Nursery Products) Regulations (Amendment)
The Horticultural Levy Act 1987 (the Levy Act) provides for the imposition of a levy to fund a horticultural industry's participation in the Australian Horticultural Corporation (AHC) and the Horticultural Research and Development Corporation (HRDC). The nursery industry is one of those industries which is a levy paying member of the AHC and the HRDC.
Subsection 14(1) of the Levy Act empowers the Governor General may make regulations for the purposes of the Act.
Section 6 of the Levy Act imposes the levy on leviable horticultural products produced in Australia. Sections 8 and 9 of the Levy Act permit the rate of levy destined for the AHC and HRDC, respectively, to be fixed by regulation. At present, a levy of 2.5% of the value of sales is imposed on nursery pots to fund the nursery industry's participation in the AHC and HRDC. Prom this 2.5% rate, 1.25% is apportioned to the AHC and 1.25% is apportioned to the HRDC.
Subsections 14(3) and 14(4) of the Levy Act require that before making regulations relating to sections 8 and 9 of the Levy Act, respectively, the Governor-General shall take into account any relevant recommendation made to the Minister by the AHC and HRDC. Subsections 14(6) and 14(7) of the Levy Act require that before making a recommendation to the Minister, the AHC and the HRDC shall consult with the eligible industry body, for the leviable horticultural product.
The Nursery Industry Association of Australia (NIAA), which is the prescribed eligible industry body for the nursery industry, has requested the Government to amend the regulations to provide for an increase in the rate of levy on the value of pot sales from 2.5% to 5% with effect from 1 July 1995. The NIAA has further requested that a 3.4% component of the new levy be apportioned to the AHC and a 1.6% component be apportioned to the HRDC.
A copy of the NIAA's request to the Minister for Primary Industries and Energy for the increase is at Attachment A. The AHC and HRDC also support the increase. A copy of their letters to the Minister recommending the increase in the levy rate are at Attachments B and C respectively.
Senator, The Honourable Bob Collins MP
Minister for Primary Industries & Energy
Parliament House
CANBERRA ACT 2600
Dear Minister
You may recall during one of our visits to your office and meetings with your adviser Mr Les Roberts, that the Nursery Industry Association of Australia (NIAA) has been examining possible alternative options to the collection methods for the industry product levy.
This examination followed a decision made at the NIAA Annual General Meeting in February 1994. From this time NIAA has worked closely with officers of DPIE and in particular with the Horticultural Branch and the Levies Management Unit of the Department. The cooperation and support provided with our studies has been totally cooperative at all times and an excellent relationship has been developed.
Several options over the past year were examined and prior to the 1995 NIAA Conference a workable alternative option was decided which could be offered to industry members as a viable alternative.
This option was publicised throughout the industry in a range of publications as well as the NIAA internal magazines, culminating in the invitation to members of the nursery industry to attend a public open forum meeting where the, available options would be discussed and a course, determined by those present or by mail from those unable to attend. In the latter instances some 80 responses were received.
The options offered to members of the industry were:
• Leave the present product levy as existing in current legislation, its no change to the 2 1/2% on greenstock grown in containers
or
• Increase the present levy
or
• Request for a change within the confines of the present legislation to introduce a collection base using an ad valorem method.
Following a detailed presentation of the options available, the industry members present and those responding by mail rejected the third option almost unanimously, but the second option to increase the present product levy was agreed by 97% of those present. Further it was suggested that the levy be increased from 2 1/2% to 5% on greenstock grown in containers.
Following this industry response, a press release was issued to major horticultural publications, statutory authorities and State industry associations. To date we have not received any significant objection to the proposal to increase the present levy percentage.
We have then been. advised that the MC have written to you independently supporting our proposal and we anticipate that the HRDC are also supportive of the changes and will confirm this to your office.
The members of the nursery industry are now more aware of the importance of sufficient industry funding being available to promote and provide research and development funding. The increased levy income will permit extensive improvements to all facets of industry activity and promotion.
On behalf of the nursery industry in Australia, NIAA as the peak industry body seeks your approval to vary the present levy % charge and the allocation of industry levy monies as follows:
• Increase the present product levy from 2 1/2% to 5%.
• Vary the existing allocation of the industry levy to:
* AHC - 2/3rd of the 5% levy funds collected
* HRDC - 113rd of the 5% levy funds collected
We would further request that the effective date of change be promulgated as 1 July 1995. DPIE horticultural branch, who had a representative at the Open Forum meeting (Mr Steve McCutcheon) is fully aware of the decision taken at the meeting.
Your consideration 'and approval would be of great benefit to the progress of the nursery industry in Australia and will permit projects previously restricted from lack of industry resources to proceed.
Yours sincerely
Warren F Bassam
Chief Executive Officer
AUSTRALIAN HORTICULTURAL CORPORATION
14 March, 1995
Senator the Hon Bob Collins
Minister for Primary Industries and Energy
Parliament House
CANBERRA ACT 2600
Dear Minister
Re: Nursery Industry Levies
A request has been received, copy attached, from the NIAA seeking an increase in the product levy rates contributed to the AHC and HRDC.
The levy rates proposed by NIAA are 3.4% on pot sales to AHC and 1.6% to HRDC, effective from 1 July 1995. Current rates are 1.25% to each Corporation.
Funding options were publicised to the nursery industry by NIAA prior to the industry Annual Conference in early March. An open meeting on funding during the Conference was also widely publicised. It was at this meeting that a significant majority voted for the increase in levy rates.
It is, therefore, recommended that the request by NIAA to increase the nursery industry levy to 3.4% for marketing support programmes through the AHC be approved.
Yours faithfully
JOHN BAKER
Managing Director
HORTICULTURAL RESEARCH & DEVELOPMENT CORPORATION
2 May 1995
Senator Hon R Collins
Minister for Primary Industries and Energy
Parliament House
Canberra
ACT 2600
Dear Senator Collins,
At the 1995 Annual General Meeting of the Nursery Industry Association of Australia (NIAA), it was resolved to increase the nursery products research and development levy from 1.25% to 1.6% of the wholesale price of the container, effective from July 1, 1995.
Consequently, and pursuant to section 14(4) of the Horticultural Levy Act 1987, the Horticultural Research and Development Corporation recommends that the levy for nursery products be increased in fine with industry wishes.
The Corporation recommends that the rate of levy in respect of sections 9 of the Horticultural Levy Act 1987
and the regulation should be amended in line with the NIAA resolution, to 1.6% of the wholesale container price.
I would be grateful if you could arrange for the necessary regulations to he put in place to allow for the increase of this levy, and I am enclosing copies of relevant correspondence from the NIAA.
Yours sincerely,
DAVID MINNIS
Chairman