2002

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

 

DAIRY INDUSTRY LEGISLATION AMENDMENT BILL 2002

 

 

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by the authority of the Minister for Agriculture, Fisheries and Forestry,

the Hon Warren Truss MP)

 

 

DAIRY INDUSTRY LEGISLATION AMENDMENT BILL 2002

 

GENERAL OUTLINE 

 

1.       The amendments to the Dairy Produce Act 1986 incorporate:

      an additional function of the Australian Dairy Corporation (ADC) to provide for the planning, facilitation and participation in the reform or privatisation of the ADC and the Dairy Research and Development Corporation (DRDC), and

     a provision for holders of Dairy Structural Adjustment Program (DSAP) scheme and Supplementary Dairy Assistance (SDA) scheme entitlements to access a farm exit payment under the Farm Help Re-establishment Grant scheme of the Farm Household Support Act 1992 .

2.       Significant changes over recent years in the market situation and corporate structure of the Australian dairy industry, particularly since deregulation in July 2000, have prompted the dairy industry to seek a rationalisation of industry statutory service delivery arrangements to better meet industry priorities and to improve the efficiency of service delivery functions.  To move forward this reform agenda, the dairy industry has sought the assistance of Government in considering options for reform of the two statutory service providers.

3.       These amendments will provide the mechanism for the ADC to fund investigations into options for statutory reform, including funding the participation of the Commonwealth, DRDC and industry representative bodies and in the longer term, to potentially fund an acceptable reform implementation process.

4.       The amendments to the Dairy Produce Act 1986 and the Farm Household Support Act 1992 will enable holders of DSAP and SDA entitlements to be eligible to apply for exit assistance under the Farm Help Re-establishment Grant scheme.  This is necessary to enable farmer who were previously eligible to apply under the Dairy Exit Program (DEP) to continue to have access to exit assistance following the expiring of DEP on 30 June 2002. 

FINANCIAL IMPACT STATEMENT

5.       The proposed amendments to the Dairy Produce Act 1986 will not impose any additional costs on the Commonwealth.

 

NOTES OF CLAUSES

Clause 1 - Short Title

6.       This clause provides for the Act to be called the Dairy Industry Legislation  Amendment Act 2002 .

Clause 2 - Commencement

7.       Clause 2 provides that the amendments to the Dairy Produce Act 1986 and the Farm Household Support Act 1992 will come into effect on Royal Assent.

Clause 3 - Schedule(s)

8.       Clause 3 provides that the amendments or the repeal of any Acts specified in Schedule 1 to the Bill, and any other items in the Schedule, are amended or repealed according to the terms of the Schedule.

 

SCHEDULE 1 - AMENDMENTS

 

Dairy Produce Act 1986

 

Item 1 - at the end of section 7

9.       Item 1 imposes additional functions on the Australian Dairy Corporation (ADC).  These functions are necessarily broad to allow the ADC to effectively implement Government policy.  Specifically, new subsection 2 provides the ADC with the additional function of planning, facilitating and participating in the reform, privatisation or abolition of the ADC and/or the Dairy Research and Development Corporation (DRDC), or the establishment of a new body or bodies to perform the current functions of the ADC or DRDC, or both.  This function is constrained by any written directions from the Minister under new subsection 5.

10.   New subsection 3 gives the DRDC the meaning of the Dairy Research and Development Corporation established by section 8 of the Primary Industries and Energy Research and Development Act 1989 .

11.   New subsection 4 gives the ADC the further function of funding the process of reform as provided for in subsection 2.  This will facilitate the involvement of the DRDC, the Commonwealth and other industry bodies in potential reform processes by providing a funding mechanism.  Again, this function is constrained by any written directions from the Minister under new subsection 5.

 

12.   New subsection 5 provides for the Minister to give the ADC written directions about the performance of its functions under subsections 2 and 4.  It distinguishes Ministerial directions under new subsection 5 from a section 8 Ministerial direction.  Section 8 directions may only be given if the Minister is satisfied that they are necessary because of exceptional circumstances and to ensure the operations of the ADC do not conflict with major Government policies.  This is not the case for directions under new subsection 5.

13.   New subsection 6 ensures the ADC must comply with any directions given by the Minister under subsection 5.

14.   New subsection 7 further defines the scope of Ministerial directions provided for in new subsection 5.  It allows Ministerial directions to address both specific matters, such as individual tasks within a broader policy framework, or alternatively set out general policies such as a broad reform process and require the ADC to perform the relevant functions consistently with those policies.

15.   New subsection 8 allows the Minister to delegate the power to give such directions to an Agency Head within the meaning of the Public Service Act 1999 .

Item 2 - paragraph 88(1)(ab)

16.   Item 1A is a consequential amendment to Item 1.

Item 3 - paragraph 91(aaa)

17.   Item 1B is a consequential amendment to Item 1.

Item 4 - at the end of subclause 119(2B) of Schedule 1

18.   Subclause 119(2B) relates to the Corporation’s powers to share information only in relation to certain schemes.  Item 4 inserts new subsection 2B(e), which provides for information pertaining to dairy-type grants, as described in Item 5, can be disclosed for administrative purposes such as determining eligibility and level of payments to successful applicants.  A related amendment in Item 19, amending the Farm Household Support Act 1992 provides for corresponding information in relation to the granting of a dairy-type grant to be provided to the Dairy Adjustment Authority and the Corporation to assist in the administration of the DSAP and SDA schemes.

Item 5 - clause 2 of Schedule 2

19.   Item 5 provides that dairy-type grant has the same meaning as in the Farm Household Support Act 1992 .  This is further defined in Item 18 of this Bill as a re-establishment grant designated under the Farm Help Re-establishment Grant scheme as a dairy-type grant.  The purpose of this separate grant type is to allow the identification of certain types of Farm Help Re-establishment grants to provide for the provision of funding dairy-type grants from the Dairy Structural Adjustment Fund.

Item 6 - clause 19 of Schedule 2 (note 4)

20.   Note 4 of subsection 2 refers to Clause 53 of the Act dealing with the cancellation of future DSAP units when a dairy exit payment becomes payable.  Item 6 includes a dairy-type grant as one of the circumstances in which cancellation of a payment right under the Dairy Structural Adjustment Program scheme applies.

Item 7 - clause 37(L) of Schedule 2 (note 4)

21.   Note 4 of section 37L deals with the cancellation of units under the Supplementary Dairy Adjustment scheme and again, refers to Clause 53 of the Act.  Item 7 includes a dairy-type grant as one of the circumstances in which cancellation of a payment right under the SDA scheme applies.

 

Item 8 - paragraph 43(3)(e) of Schedule 2

22.   Item 8 is a consequential amendment to reflect Item 9 and the inclusion of new subsection 43(3)(f).

Item 9 - after paragraph 43(3)(e) of Schedule 2

23.   New subsection 43(3)(f) allows the Dairy Adjustment Authority to provide information in relation to DSAP/SDA payments already received by applicants for an exit payments under the Farm Help Re-establishment Grant scheme.  This provides for payments under the Farm Help Re-establishment Grant scheme to be net of any DSAP/SDA payments.

Item 10 - subclause 43(3) of Schedule 2 (note)

24.   Note of subclause 43(3) deals with the evidentiary burden placed on a defendant in relation to the protection of confidentiality of information.  Item 10 provides for the recording and disclosure of protected information if the recording and disclosure relate to the administration of dairy-type grants.

Item 11 - paragraph 53(1)(b) of Schedule 2

25.   Item 11 provides for the existing subclause 53(1)(b) to be repealed and replaced with a new subclause 53(1)(b).  New subclause 53(1)(b) provides for the cancellation of payment rights granted to a successful applicant under the Farm Help Re-establishment Grant scheme for a dairy-type grant.  This provides that successful applicants under the Farm Help Re-establishment Grant scheme cannot receive both a dairy-type grant and a DSAP and/or SDA entitlement.

Item 12 - subclause 53(2) of Schedule 2

26.   Item 12 provides for the cancellation of a unit under new Clause 53(1)(b) to take effect from the time a decision is made under the Farm Help Re-establishment Grant scheme or the Dairy Exit Program scheme.

Item 13 - after paragraph 78(f) of Schedule 2

27.   Item 13 provides that money recovered from the overpayment of dairy-type grants is to be credited to the Dairy Structural Adjustment Fund.

Item 14 - after paragraph 79(b) of Schedule 2

28.   Item 14 provides that money standing to the credit of the Dairy Structural Adjustment Fund can be expended on making dairy-type grants.  A corresponding amendment to the Farm Household Support Act 1992 , described in Item 23, provides that dairy type grants be funded from the Dairy Structural Adjustment Fund.

Item 15 - after paragraph 79(j) of Schedule 2

29.   Item 15 provides that money standing to the credit of the Dairy Structural Adjustment Fund can be expended on meeting the expenses incurred by the Commonwealth in relation to the administration of dairy-type grants.

Item 16 - paragraph 80(a) of Schedule 2

30.   Item 16 requires that the Corporation and the Minister must take all reasonable steps to ensure there are sufficient funds in the Dairy Structural Adjustment Fund to cover the costs associated with programs including dairy-type grants under the Farm Help Re-establishment Grant scheme.

Item 17 - after paragraph 94(2)(b) of Schedule 2

31.   Item 17 ensures that the Minister cannot terminate the Dairy Adjustment Levy before expenses for programs, including dairy-type grants under the Farm Help Re-establishment Grant scheme, are fully met.

Farm Household Support Act 1992

Item 18 - subsection 3(2)

32.   Item 18 provides that a dairy-type grant means a re-establishment grant designated as a dairy-type grant under the farm help re-establishment grant scheme.  This will allow payments made under the Farm Help Re-establishment Grant scheme to be identified as dairy type grants to allow for the funding of these payments from the Dairy Structural Adjustment Fund.

 

Item 19 - after subsection 52A(5)

33.   Item 19 relates to the disclosure of information to enable the cancellation of an applicant’s entitlements under DSAP/SDA.  New subsection (5A) provides that the farm help re-establishment grant scheme can disclose information to the Dairy Adjustment Authority and the Australian Dairy Corporation in relation to dairy-type grants.  This item is also referred to in the description of Item 4, which makes the corresponding provision for the Australian Dairy Corporation to provide information to assist in the determination of eligibility and payment level of applicants for dairy-type grant under the Farm Help Re-establishment Grant scheme.

34.   New subsection (5B) provides that dairy-type information is given the meaning of information disclosed or obtained for the purposes of dairy-type grants.

Item 20 - paragraph 56(2)(a)

35.   Paragraph 56(2)(a) relates to the recovery of overpayments in full or in part of re-establishment grants.  As dairy-type grants under the re-establishment grant scheme are to be funded from the Dairy Structural Adjustment Fund and therefore, any overpayments of these types of grants are to be credited to the Dairy Structural Adjustment Fund, as provided for in Item 13, Item 20 provides that only overpayments from re-establishment grants not designated as dairy-type grants, can be regarded as a debt due to the Commonwealth.

Item 21 - after subsection 56(2)

36.   Item 21 inserts new subsection 56(2A) which provides for any overpayments in full or in part of dairy-type grants can be recovered by the Commonwealth, but are to be regarded as a debt due to the Australian Dairy Corporation.  This is because, as described in Item 13, overpayments of dairy-type grants are to be credited to the Dairy Structural Adjustment Fund.  The Australian Dairy Corporation administers the Dairy Structural Adjustment Fund.

Item 22 - subsection 57(4)

37.   Item 22 ensures that dairy-type payments under the farm help re-establishment grant scheme are not funded out of general revenue.  As described in Item 14, amending the Dairy Produce Act 1986 and Item 23, amending the Farm Household Support Act 1992 , the Dairy Structural Adjustment Fund is to fund dairy-type grants.

Item 23 - subsection 57(5)

38.   Item 23 ensures that dairy-type payments under the farm help re-establishment grant scheme are funded out from the Dairy Structural Adjustment Fund.