EXPLANATORY STATEMENT

 

Select Legislative Instrument 2010 No. 283

 

Issued by the Authority of the Parliamentary Secretary for Agriculture, Fisheries and Forestry

 

Primary Industries (Excise) Levies Act 1999

Primary Industries (Excise) Levies Amendment Regulations 2010 (No. 5)

 

Legislative Authority

 

Section 8 of the Primary Industries (Excise) Levies Act 1999 (the Act) provides, in part, that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.

 

The Act prescribes levies on primary industry products for the purposes of marketing, research and development, government-industry body membership and emergency pest and disease responses as specified for each commodity.

 

Clause 2 of Schedule 27 to the Act provides that the regulations may impose a levy on one or more specified primary industry products in the circumstances, at the rates, and payable by the person, ascertained in accordance with the regulations.

 

Clause 2 of Schedule 19 to the Primary Industries (Excise) Levies Regulations 1999 (the Principal Regulations) imposes an Emergency Animal Disease Response (EADR) levy on meat chickens.

 

Background

 

In 2002, the Australian Chicken Meat Federation (ACMF) sought Commonwealth Government assistance to underwrite the chicken meat industry’s share of the costs for the eradication of two Newcastle disease outbreaks under the terms of the Emergency Animal Disease Response Agreement.

 

The first of these two disease outbreaks occurred in Meredith, Victoria in May 2002 and the chicken meat industry’s share of the cost to eradicate the disease was $795,316.50. The second outbreak occurred in Horsley Park, New South Wales and the industry’s share of the cost to eradicate the disease was $179,560.70. The total original debt was therefore $974,877.20.

 

The chicken meat industry elected to repay this debt over a period of approximately seven years from the commencement of the positive operative EADR levy on meat chickens. The EADR levy commenced on 1 July 2004 and was set at a rate of 0.033 cents per meat chicken to repay the underwritten amount.

 

The chicken meat industry’s share of costs to eradicate the Meredith and Horsley Park outbreaks of Newcastle disease has been repaid to the Commonwealth.

 

Accordingly, the chicken meat industry and the Commonwealth agreed that the EADR levy that was being applied to meat chickens should be set back to nil cents per meat chicken.

 

The excess amount of EADR levy collected prior to the levy rate returning to nil will be paid to Animal Health Australia and be held on behalf of the chicken meat industry. As mandated under section 4 of the Australian Animal Health Council (Live-stock Industries) Funding Act 1996, Animal Health Australia applies the excess levy payments to take measures relating to the promotion or maintenance of the health of meat chickens.

 

Purpose and Impact

 

The Primary Industries (Excise) Levies Amendment Regulations 2010 (No. 5) (the Amendment Regulations) amends the Principal Regulations by reducing the EADR levy for meat chickens from 0.033 cents per meat chicken to nil cents per meat chicken. This change will have a positive impact on the chicken meat industry, both administratively and financially, as it will no longer be required to pay an EADR levy for meat chickens.

 

Consultation

 

Subclause 14(2) of Schedule 27 to the Act specifies that if there is a single body that is a designated body in relation to a particular product, then the Minister for Agriculture, Fisheries and Forestry (the Minister) must take into consideration any relevant recommendation made to the Minister by that body before the Governor-General makes a regulation in relation to the product. However, there are no designated bodies declared by the Minister for chicken meat.

 

For a levy to be amended, industry (generally through its representative body) must demonstrate that the Australian Government Levy Principles and Guidelines (AGLPG) have been complied with. This includes demonstrating that sufficient consultation has been undertaken with all sectors of the potentially effected industry or current levy payers, and that there is industry support for the change in levy rate.

 

The letter from the Australian Chicken Meat Federation (ACMF) to the Department of Agriculture, Fisheries and Forestry, received 11 May 2010, demonstrates compliance with the AGLPG. In this letter, the ACMF agreed that the Commonwealth should reset the EADR levy for meat chickens from 0.033 cents per meat chicken to nil cents per meat chicken.

 

The ACMF is the national coordinating body for participants in the chicken meat industry. In coming to this position, the ACMF also consulted with the Australian Poultry Industries Association, which represents the eight major chicken meat processors. The unanimous view was that the EADR levy should be reset to nil.

 

The Office of Best Practice Regulation determined that no further consultation in the form of a Business Cost Calculator or a Regulation Impact Statement was required for the Amendment Regulations.

 

 

Operation

 

The Amendment Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.

 

Details of the Amendment Regulations are set out below.

 

Regulation 1 specifies that the name of the Amendment Regulations is the Primary Industries (Excise) Levies Amendment Regulations 2010 (No. 5).

 

Regulation 2 provides that the Amendment Regulations commence on the day after registration on the Federal Register of Legislative Instruments.

 

Regulation 3 provides that Schedule 1 amends the Principal Regulations.

 

Schedule 1 Amendments

 

Item 1 amends subclause 2(1) of Schedule 19 to the Primary Regulations by omitting the words ‘hatched after the commencement of this clause’. These words are unnecessary since the levy is reduced to a nil operative rate by the amendment to subclause 2(2) of Schedule 19.

 

Item 2 amends subclause 2(2) of Schedule 19 to the Primary Regulations by omitting the words ‘0.033 of a cent per meat chicken’ and inserting in its place the word ‘nil’. This reduces the EADR levy imposed on at chickens from 0.033 of a cent per meat chicken to nil cents per meat chicken.