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Monday, 14 October 2002
Page: 5109

Senator O'Brien asked the Minister for Health and Ageing, upon notice, on 29 August 2002:

With reference to the introduction of mandatory nutrition labelling, effective from 20 December 2002:

(1) What changes to labelling information will be required.

(2) How many Australian food businesses will be affected by the new requirements.

(3) What is the estimated cost to Australian food businesses of the introduction of the new requirements.

(4) Do the labelling requirements apply to imported packaged food products.

(5) What penalties apply for breaches of the new requirements.

(6) Do these penalties apply to: (a) importers; (b) manufacturers; and (c) retailers.

(7) Which agency has responsibility for monitoring and enforcing compliance.

(8) (a) When were food businesses first advised of the new labelling requirements; and (b) what form did that advice take.

(9) What action, if any, is the Commonwealth taking to assist businesses to comply with the new requirements.

(10) With reference to the statement by the Parliamentary Secretary to the Minister for Health and Ageing on 20 August 2002 that, `320 to 460 lives could be saved each year in Australia and New Zealand with the introduction of mandatory nutrition labelling': What evidence is available to support that statement.

(11) Has Food Standards Australia New Zealand received any advice that some food businesses will fail to comply with the new requirements by 20 December 2002; if so, how many food businesses have provided this advice.

Senator Patterson (Minister for Health and Ageing) —The answer to the honourable senator's question is as follows:

(1) The new Standard for nutrition labelling in the joint Australia New Zealand Food Standards Code (the Code), approved by Commonwealth, State, Territory and New Zealand Health Ministers in December 2000, will require most manufactured foods to carry information on the key nutrients: energy; protein; fat; saturated fat; carbohydrate; sugars and sodium in the mandatory nutrition information panel.

This differs from the previous requirement, where a nutrition information panel providing information on energy, protein, fat, carbohydrate, sugars, sodium and potassium was only required when a nutrition claim (for example `low salt') was made about a food or on special purpose foods such as formula dietary foods.

The new Standard also requires detail about other nutrients under certain circumstances:

· where a nutrition claim is made in relation to a food for any nutrient or biologically active substance other than the seven key nutrients, information on that nutrient or biologically active substance must also be declared;

· where a nutrition claim is made in respect of fatty acids or cholesterol, the fatty acid and cholesterol content of the food must also be declared;

· where a nutrition claim is made in respect of fibre, sugar or carbohydrate, the presence or absence of dietary fibre in the food must also be declared;

· where a nutrition claim is made in relation to the lactose content of a food, particulars of the lactose and galactose content of the food must be declared; and

· where a nutrition claim is made in respect of the salt or sodium content of a food, the potassium content of the food must also be declared.

These changes were introduced in December 2000 to allow industry two years to adjust to the new requirements.

(2) Recent statistics available from the Australian Bureau of Statistics indicate that there are 3,086 Australian businesses involved in processing food or non-alcoholic beverages. Data on the number of food retail businesses are not available.

(3) KPMG Consulting and the Allen Consulting Group estimated the cost of percentage ingredient labelling and the Nutrition Information Panel.

KPMG Consulting estimated the cost to industry in Australia and New Zealand to be $394 million to implement these, with a further $55 million per year in ongoing costs. On the basis of the number of stock keeping units likely to be affected in Australia of 100,000 the cost estimates for Australian industry would be $219 million to implement and $31 million per year ongoing costs.

The Allen Consulting Group estimated the cost to industry of implementing the new requirements to be $100 million, but did not have data to independently measure the extent of ongoing costs.

(4) Yes.

(5) The Code is enforced under the State and Territory and New Zealand Food Acts. The penalties that may apply will vary according to the specific State or Territory legislation.

The Imported Food Control Act 1992 requires imported food products to meet the requirements of the Code. The maximum penalty for importation of food that does not meet the relevant standard is 10 years imprisonment, or $66,000 in the case of an individual and $330,000 in the case of a corporation.

(6) Yes, depending on the circumstances.

(7) The Code is enforced by the States and Territories under State and Territory Food Acts. Imported foods are covered under the Imported Food Control Act 1992 which is enforced by AQIS.

(8) (a) The formal review of nutrition labelling commenced in December 1997 and pursuant to the Australia New Zealand Food Authority Act 1991, a minimum of two rounds of public consultation were undertaken during the review. The draft joint Code was released on the ANZFA website for public consultation between March and May 2000. Additional and extensive consultations were held with industry during that period.

(b) During the review of labelling requirements, consultation occurred through public notification in newspapers and through distribution of information circulars and requests for comments as well as through many meetings with industry bodies and individual businesses. The final draft Code was widely circulated to industry for comment in 2000 before Ministers on the Australia New Zealand Food Standards Council agreed to adopt mandatory nutrition information requirements at a meeting on 24 November 2000. A communiqué was widely circulated to media and other stakeholders on that date.

(9) Prior to the adoption of the joint Code, ANZFA established a communication and implementation strategy for nutrition labelling and other aspects of the new Code. Since Ministers agreed to the new Code in November 2000, ANZFA has deployed the following strategies to assist industry during the two year transition to the new requirements:

- a local call cost phone/email industry advice line was established in January 2001. Initially, the advice line handled approximately 60 inquiries per day, and currently it handles approximately 100 inquiries per day;

- a set of 12 comprehensive interpretive User Guides and numerous fact sheets were provided free on the Food Standards Australia New Zealand (FSANZ) web site. This includes a guide to nutrition information labelling;

- a nutrition panel calculator that incorporates over 2000 food ingredients and enables development of nutrition information labels in the mandatory format for the majority of foods was also provided free on the FSANZ web site and was launched in November 2001;

- a comprehensive training package and seminars for industry and jurisdictional health officers was delivered throughout 2001 and 2002 mainly in conjunction with State and Territory enforcement bodies; and

- in 2002 as the end of the transition approaches, FSANZ has issued reminders of the need for industry to address the required labelling changes through numerous media releases, distribution of information circulars and brochures to stakeholders (including all local councils in Australia), and through presentations at key conferences, in particular to industry associations.

(10) The evidence on lives saved was compiled from two sources of data on diet-related disease:

· The Australian Institute of Health and Welfare (1999), The burden of disease and injury in Australia; and

· The New Zealand Ministry of Health (1999), Our Health, Our Future - The Health of New Zealanders.

These publications measure the burden of disease on the respective populations of Australia and New Zealand. Diet-related risk factors were identified and measured in terms of mortality. To help avoid over-estimation, the risk factors were halved for the purposes of this calculation.

The analysis of the potential impact on public health due to the change from voluntary to mandatory nutrition labelling was based on a scientific study reported in the Journal of Law & Economics, October 2000 by Alan Mathios; The impact of mandatory disclosure laws on product choices: an analysis of the salad dressing market. This study examined consumer purchasing behaviour of benchmark products before and after the introduction of mandatory nutrition labelling in the United States (US), and observed that after nutrition labelling became mandatory, there was a fall in the market share of the least healthy products. On the assumption that the US experience is relevant to Australia and New Zealand, results of the US study were then used to estimate the impact of the introduction of mandatory nutrition labelling in Australia and New Zealand.

(11) An industry association submission made to FSANZ earlier this year claimed that figures obtained from a range of companies expressed the view that 98.5 % of their food labels would comply with all the new labelling provisions of the Code by 20 December 2002.

At a recent industry conference on food labelling it was reported by Ron Cossen, Director of Ronald L Cossen and Associates, that 61% of companies represented at the conference will be `ready' and the remaining 39% will be `almost ready' on 20 December this year. These figures were based on responses to a questionnaire distributed to, and completed by, conference delegates.

Recent qualitative research undertaken by FSANZ with stakeholders indicates that larger sized manufacturers are well informed about the labelling changes and have made significant progress in changing labels. However there were concerns about the awareness of small manufacturers about the new labelling requirements and their capacity to implement changes by the end of the transition period.

Transitional `stock-in-trade amendments' were made to the Code in June this year. Those amendments permit food products manufactured and packaged under the old requirements prior to 20 December 2002 to be sold up to 20 December 2003, in the case of short shelf life foods (i.e. less than 12 months). For long shelf life foods (i.e. greater than 12 months) foods manufactured and packaged prior to 20 December 2002 will be allowed to be sold until 20 December 2004.