Monday, 26 May 2014
Agricultural and Veterinary Chemicals Legislation Amendment (Removing Re-approval and Re-registration) Bill 2014; Second Reading
I am pleased to speak on any bills such as this bill, the Agriculture and Veterinary Chemicals Legislation Amendment (Removing Re-approval and Re-registration) Bill 2014, which at their very heart are about freeing up Australians from unnecessary burdensome red tape. My colleague the member for Lyne ended his remarks by saying that these were sensible amendments and this was a common-sense approach. This bill seeks to re-establish a sensible, common-sense approach to agricultural and veterinary chemicals for use in the agricultural sector.
The amendment act was passed by parliament in June 2013 and included the introduction of a scheme for reapproval of active constituents and re-registration of chemical products to commence on 1 July 2014. This bill delivers on an election commitment made by the coalition in the lead-up to the 2013 election to remove the reapproval and re-registration scheme and introduce other efficiency measures.
Industry needs an efficient regulator so that it can have timely access to new technology, to reduce the cost of production and provide options to reduce resistance and to continue to provide the highest quality food both for the domestic and the international markets. As the global population is expected to reach nine billion by 2050, it is imperative that Australia, which has one of the most sustainable production systems in the world, continues to punch above its weight to address this growing food and fibre task—with respect to not only domestic production but also, importantly, the ever-increasing export of sustainable product.
I am pleased that this bill will deliver on our election promise to remove that cumbersome re-registration and reapproval scheme for agvet chemicals. These reforms aim to reduce red tape for farmers and other businesses and encourage the development of new chemistry, with a range of benefits for farmers and other users, the environment and, importantly, the wider community.
Australian farmers, quite rightly, take great pride in the products that they deliver to market. Protecting our image as premium quality producers is paramount for the nation. However, the re-registration scheme introduced in 2013 for effect from 1 July 2014 sought to damage that very process and, indeed, had the very real risk of damaging our clean, green image. It was really just another case of industry being tied up in red tape. This government, thankfully, understands how business works. Time spent to re-register a product that has not changed in composition, has not had any credible scientific evaluation to show a change may be needed, is just compliance, disappointingly, for compliance sake. It does not produce a more efficient or more valuable outcome; it just wastes time and money better spent delivering new and improved products.
Our government considers that, prior to the Agricultural and Veterinary Chemicals Legislation Act 2013, existing chemical review mechanisms allowed for the examination of newly discovered risks about the safety, efficacy or trade impact of a chemical. New mechanisms that duplicate the existing systems and impose additional costs on the industry are not required and are likely to result in a loss of safe chemicals because many cheap off-patent chemicals will not be economical to re-register. Reconsiderations are costly exercises that should be undertaken only when the risk of use of an unsafe product warrants the regulatory burden imposed. The APVMA already uses the activities, assessments and decisions of overseas regulators and reviews peer-reviewed science about pesticides to inform its prioritisation of chemicals for reconsideration.
The approach set out in the previous act would be to add red tape without improving protection or safety provisions. In fact, this time-consuming process may in fact lead to fewer agvet chemicals being available for use due to the costs and, in very many cases, the limited use, albeit importantly. The extra costs from re-registration are despite the former finance and deregulation minister, Penny Wong, using agricultural and veterinary chemical reforms as a second key area, where the government will reduce regulatory compliance costs for businesses and improve competitiveness, as outlined in the minister's paper on the Australian government deregulation agenda.
It is estimated that these amendments will save the agvet chemicals industry $1.3 million a year. That is $1.3 million in time and fees and it is $1.3 million that will ensure that farmers have access to the safe chemicals that they need to efficiently tackle the ever-growing global food task. This bill will ensure that further efficiency is added to the sector by introducing new processes for notification of the simplest changes to chemical registration and very simple application for less complex variations. If a company wants to change pack size or the company address on the label, they do not need to have a technical assessment and lodge an application that would normally cost around $1,000. Instead, for these simple changes they can just inform the APVMA and make the change. As I said at the beginning of my remarks, this is a return to sensible, common sense approaches.
Reducing the frequency of renewal, removing annual returns about active constituents, improving information access provisions—this amendment allows the government to extend by regulation the period of renewal for up to seven years. A renewal is simply an administrative process to extend registration and has no checks for safety and performance. The APVMA has strongly established systems to trigger a review if potential risks to safety and performance have been identified. A review may well be initiated when new research or evidence has raised concerns about use or safety of a particular chemical product. It is deregulation of this nature that is vital for the continued prosperity of Australian business.
This bill and the changes it proposes to make are all about red tape reduction—and what a relief. While I am on the topic of red tape, I want to commend the Prime Minister and the Parliamentary Secretary to the Prime Minister, the member for Kooyong, for their commitment to the cause of deregulation. Small businesses provide so much firepower to the regional economies in my electorate, and I identify very strongly and proudly with the family-owned businesses in Barker. Indeed, I am pleased to speak on their behalf.
I cannot help but see the world through the eyes of a small business operator. Growing up I was surrounded by private enterprise, given my father's horticultural and agricultural interests in the lower south-east and my mother's longstanding retail fashion businesses. My mother's retail fashion store found itself for a very long period of time on Commercial Street in Mt Gambier. I hasten to think that if those opposite had responsibility for naming the road they might have called it Regulation Road instead. When my wife and I established our own legal practice I came to understand firsthand the pitfalls of over-regulation. The legal profession is of course one of the most over-regulated in the world and in very many respects for good reason. But I know from personal experience that red tape can become the weed which, like some insidious exotic vine, slowly but ever-effectively strangles the otherwise healthy organism that it has latched onto.
We know—at least those on this side of the House do—that Labor is either unable or unwilling to undertake regular pruning of this weed so that red tape or green tape or any other sort of tape is allowed to grow out of control. The amendment act passed in June 2013 was an example of that. Alas, it is left to the coalition government to remove Labor's overgrown and out of control regulatory burden to create the breathing space business needs to create more investment and jobs. So it is our duty to prevent over-regulation. The role of regulators themselves and compliance costs faced by business and the not-for-profit sector have to be put under the microscope.
It is easy to see why Labor and the Greens are not all that worried about the way the regulatory burden strangles our economy. While those on this side of the House, such as me, want to create an environment where small-business operators can grow and employ more Australians, those on the left are happy to see that growth of jobs in the public sector. They rejoice when the bureaucracy advertises for more staff. That is the only sort of growth they aspire to. I, on the other hand, when I read those ads, sigh sadly. They think it is great for this insidious vine of red tape to grow evermore, slowly strangling private enterprise, strangling small family-owned business operators and killing the chances of further growth and job creation. I know that the words of former British Prime Minister Tony Blair have been cited on this topic a few times but, quite frankly, he was spot on. He said:
It seems to be part of the DNA of regulatory bodies that they acquire their own interests and begin to grow.
I am pleased, if surprised, that a member of the Labor party, albeit the British version, was able to make that observation. I wish members of the ALP were willing to open their eyes in a similar fashion.
As the member for Barker, an electorate which boasts a wonderful, industrious small and medium-sized business community and a magnificent agricultural industry across its breadth, I feel absolutely obliged to stand in this place and represent the needs of those whose hard work makes our proud regional communities tick. From my ongoing conversations with the business community in Barker, I know they feel they are being dominated by a culture of compliance and enforcement that stifles productivity. It would be remiss of me if I did not also note that, while regulators have the ability to cost-recover their fees from industry, it is industry that bears the impost of regulators' risk aversion.
The agricultural and veterinary chemicals industry is a sector that is highly commoditised. The reality is that the margins are incredibly small. So, if the actions of regulators increase the costs of inputs, that has a very strong and direct impact on the profitability of the farm sector. I have personal experience when it comes to this. My father, as I said, was an agriculturalist. I remember being about eight and being told by my father that we needed to pass an inspection for the export of a quantity of onions. At the time, he was growing some 4,000 tonnes of onions, which was a significant amount for the early eighties. Despite all his efforts, on the day, we failed the inspection and, as a result, we were required to repack in the order of 1,000 tonnes of onions. It was Easter, and as a religious family it was a cause for great embarrassment that we had to call in every favour we had to pack these onions over Easter. Of course, that is not a time for work but, rather, for religious reflection
I recall vividly, although I was only eight or so, that at the conclusion of that work my father bent over towards me—it is an indelible image—and said, 'That's it.' I said to him, 'That's what?' He said, 'That's it; I'm never growing another onion again,' bearing in mind that we were growing some 4,000 tonnes. It was probably a good decision because the onion industry has had some tough times since 1983. We transitioned into other, less labour-intensive industries but still agricultural—mixed cattle, sheep and those things. But I often wonder what became of the 20 or so people that he employed. This was a decision he made, bored by the unnecessary red tape in a burgeoning export industry—a sad state of affairs.
In any event, I commend this bill to the House. It is a return to common sense, addressing the ever-growing burden of red tape in this country.