Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Rural and Regional Affairs and Transport References Committee
07/12/2018
Independence of regulatory decisions made by the Australian Pesticides and Veterinary Medicines Authority

STAPLEY, Mr Ben, Executive Director, Animal Medicines Australia

[12:26]

CHAIR: We now welcome Mr Ben Stapley from Animal Medicines Australia. The committee have received your submission as submission No. 26. Do you want to make any amendments or additions to your submission?

Mr Stapley : No, thank you.

CHAIR: You know where we go from here—over to you for a brief opening statement.

Mr Stapley : Thank you and good afternoon. As the leading association for the animal health sector in Australia, and on behalf of our members, Animal Medicines Australia appreciate the opportunity to appear before the committee today. Animal Medicines Australia, or AMA, represents the country's largest importers, manufacturers, registrants and suppliers of animal health products. Collectively, our members represent approximately 85 per cent of the Australian market. Our members' products go from flea collars and insecticidal shampoos for our pets through to medications and treatments that support the health and welfare of livestock. Research that we conducted earlier this year on our economic contribution confirms that responsible use of animal health products adds $2.7 billion to Australia's livestock production; supports nearly 10,000 jobs; provides $587 million in wages and salaries; and reduces household expenditure on meat, dairy and eggs by $270 each year.

These products are subject to a rigorous, comprehensive and independent premarket assessment by the APVMA to confirm their safety and efficacy. We have every confidence in the rigour of the APVMA's assessments and decisions. Our members rely on the independence of those assessments, along with comprehensive and rigorous quality assurance and GMP processes, to ensure our customers and other users that, when used in accordance with label directions, those products present no unacceptable risk to themselves or animals in their care.

We do consider that there are significant opportunities to increase the efficiency of the APVMA scheme without impacting the rigour of the premarket assessments conducted by the regulator. The APVMA has been subject to multiple reviews and inquiries since its creation. While AMA considers the assessments conducted by the APVMA to be rigorous, the relevant legislation is very complex. Any reform has been slow to be implemented. We encourage the committee to consider the reasons for that.

Finally, our experience is that the APVMA scheme is broadly effective but not particularly efficient. Indeed, that was the finding of the Productivity Commission report on chemicals and plastics regulation in 2008. AMA and our members want the regulator to be successful. We want them to be meeting agreed principles and outcomes. This will promote predictability, transparency and effectiveness, and increase confidence in the scheme. I'm happy to take questions.

CHAIR: Thank you, Mr Stapley. Senator Rice.

Senator RICE: In your submission, in section 7.5, you talk about the relocation of the APVMA to Armidale. Would you like to expand on your views about how that has impacted the effectiveness of the APVMA and their ability to do their work?

Mr Stapley : I think the challenge with the relocation has always been the loss of staff that has been associated with it.

From our perspective, the key risk associated with that relocation has been the impact on assessments, the impact on confidence and the ability of the APVMA to provide high-quality assessments. From our members' perspectives, we can always quite clearly identify when a particular application is going to be challenged by the experience of particular staff associated with the APVMA—the particular assessor associated with the APVMA. The APVMA itself has recognised that three to five years experience is necessary to get a high-quality and capable regulatory assessor. So, from that perspective, the risk that we see with the relocation is the impact on getting some of those high-quality assessments through in a predictable and timely manner.

Senator RICE: Can you just expand—you said you have different outcomes, depending on which staff your application is being—

Mr Stapley : That can occur, yes—I can only talk generally; I can't talk to specifics. The experience our members often have is that the assessor that they receive on the application that they put in can have a significant impact on the a predictability of the outcome of that assessment process.

Senator RICE: What are the criteria? What sorts of differences do you get from different staff?

Mr Stapley : That can go to questions which are asked on a particular assessment, so on a particular package of an application before it. You might get questions which are already answered in a dossier of information provided. You might get questions which are not relevant or misunderstand the application which has been provided by the applicant at the time.

Senator RICE: And so, you're saying the more experienced assessors do a better job essentially?

Mr Stapley : Yes, the experience of our members is: the more experienced assessors provide more timely and predictable outcomes.

Senator RICE: And shifting to Armidale is impacting on the level of experience?

Mr Stapley : Look, that's what we expect. As the VMDA highlighted earlier, some of these challenges pre-existed before the move to Armidale, but our concern is that they will be exacerbated by the move to Armidale.

Senator RICE: As you note in your submission, there are high levels of staff turnover?

Mr Stapley : Yes.

Senator RICE: So, your expectation is: you would have less experienced staff working with the APVMA in Armidale?

Mr Stapley : Yes, and that's already the case. We're expecting it to be identifiable in the performance statistics of the APVMA. We probably haven't seen the significant impact that we would otherwise have expected to date.

Senator RICE: They haven't had very many people move as yet.

Mr Stapley : That's right.

Senator RICE: So what do you think the government should do—or a change of government? Given the shift that's already occurring, do you see that it will work eventually but there's going to be a long teething process; or would you prefer to see many of the roles of the APVMA retained in Canberra?

Mr Stapley : It's probably a very difficult question to answer at this point in time. The challenge is, with staff in the process of moving, whether a number of staff have already made the decision as to whether they will relocate or not. I don't have all the information about whether the relocation is better to proceed or whether there should be more staff based in Canberra. Any opportunity to maintain as many experienced, qualified and capable staff within the regulator, we would support.

Senator BROCKMAN: Can I just clarify that point, Senator Rice—and correct me if I'm wrong; I'm not trying to verbal you. You're saying that you are concerned that there may be a fall-off in regulatory approval time, I guess, but that hasn't been evidenced so far?

Mr Stapley : Yes.

Senator RICE: Yet you say at the bottom of page 6 in your submission that:

AMA is yet unable to evaluate when APVMA will be in a normal business mode and meet the expectations of its range of stakeholders.

So there have been impacts already, but you feel that the full extent of the impacts is still yet to be felt?

Mr Stapley : Yes, that's correct.

Senator RICE: Which is worrying.

Senator BROCKMAN: So there have been impacts already?

Mr Stapley : Yes. Some of the impacts that we see are that the willingness of the APVMA to engage has been challenged by the prime priority that the APVMA has at the moment: to get to Armidale.

Senator BROCKMAN: So, on the engagement side, you've seen some issues, but that hasn't actually changed—you haven't had any negative implications on the outcome side yet? I'm just trying to understand—

Mr Stapley : Yes, there may be isolated cases, but from the data that we received, which is limited out from the APVMA, I haven't seen a significant impact yet.

Senator RICE: But, essentially, what you do see is a correlation between good outcomes and experienced staff?

Mr Stapley : Yes.

Senator RICE: So, if the shift to Armidale is going to result in less-experienced staff, you would expect that the quality of their engagement and the outcomes with you won't be as high?

Mr Stapley : That's our expectation.

Senator RICE: Moving on from that: in terms of reviewing chemicals and the repeal of the review and the reassessment provisions in 2014, does AMA have a view as to the review and re-assessment provisions as they were introduced and why they were repealed in 2014? What are your thoughts about that?

Mr Stapley : The short answer is that we supported the repeal of the re-registration approval. We supported that largely because of the potential implications that that would have had on the availability of products into the market. From our members' perspective, what's really important is that the APVMA are able to make, conduct or commence a review at any time on the basis of any information that they have identified. That's not necessarily something which would be time bound, whether that's a 10- or 15-a-year re-registration process—whatever that might be. If the APVMA is able to identify any additional information regarding an additional risk which it hadn't considered at the time the product was registered, the APVMA should and can currently commence a review.

Senator RICE: As I asked questions of the VMDA, the criticism of that is that it leads to an ad-hoc review and that reviews aren't done in a timely manner, because there's no requirement for the reviews to be done. Is that something that you have experienced from the AMA's perspective?

Mr Stapley : Not from my perspective. The legislation already provides that our members provide information of adverse experiences. Where our members become aware of additional information which might change the risk assessment decision that the APVMA has already made, they're obliged to provide that information to the APVMA. There are legislative provisions which require our members to provide additional information where the risk associated with a product might change. That already exists, and that, to my mind, is a much more timely and effective use of the regulator's time.

Senator RICE: And I suppose you're in a situation where you haven't got the same level of third-party concerns as, say, in the pesticides and herbicides space?

Mr Stapley : That's true as well. We also have another distinction which means that animals are often under the direct care of a veterinarian. We can observe a direct effect associated with a product much more quickly and directly than can with a—

Senator RICE: A population base impact of a herbicide or pesticide, or the impact on the natural environment that no-one is monitoring. Thank you.

Senator BROCKMAN: One quick question from me, the same question I asked the previous witness: do you think the APVMA is a science-based regulator that is operating effectively to do its job?

Mr Stapley : Yes, absolutely. We have no concern with the independence of the APVMA. We have concerns with respect to their efficiency and predictability from time to time, but the regulator on the whole is very scientifically based and makes rigorous decisions which are respected around the world.

Senator BROCKMAN: Great.

CHAIR: I'll chuck a couple more to you. The AMA notes in its submission that it:

… sees no evidence that APVMA processes are influenced by its source of funding.

And it has been flagged in other submissions to change the current funding arrangement away from a cost-recovery system. Could you comment on what may be possible impacts on access to animal medicines in Australia if there were a change in funding arrangements?

Mr Stapley : I think that would really depend upon what the change in funding arrangements might be. If I can speak a little frankly—

CHAIR: Please do.

Mr Stapley : I don't think that there's any willingness on the community to subsidise my members to bring new products to the market, so we think it's entirely appropriate that the APVMA remain cost recovered. That is the most efficient way, to actually provide the APVMA with the incentive to make decisions as efficiently as possible and deliver assessments as efficiently as possible.

CHAIR: Fair enough. Mr Stapley, there was a bit of conversation at our last hearing with the APVMA over the introduction of the governance board. What's AMA's thought about that?

Mr Stapley : We're on the record as not being particularly supportive at this point in time. Our view is that the process which has been applied to derive a solution for a governance board could have been better. We think that the process which the government would ordinarily go through in addressing a problem probably wasn't as effectively applied as we would have liked it to be. We're not really sure what problem is desired to be fixed, we're not really sure that the government identified what some of the other potential options may have been, and we're not particularly sure that the option which has ultimately been decided upon, to have a governance board, is the one which would provide the greatest net benefit to the community. There are other options which could have been considered. The minister could have renewed the statement of expectations for the CEO of the APVMA. That may have been another option which could have provided benefits which outweighed the option for a board. We think that there's an opportunity for further analysis which could come up with a better solution to address whatever the particular problem that we're trying to solve is.

CHAIR: Did you have that conversation with the APVMA?

Mr Stapley : Not necessarily with the APVMA, no.

Senator RICE: Have you had it with the minister?

CHAIR: Stop stealing my questions!

Mr Stapley : We've made those concerns known to the minister, yes.

CHAIR: Okay. I think we get the drift.

Senator RICE: The view that has been put to me about having an independent board is that there is more accountability of the APVMA on a regular basis to an independent board. How would you increase the level of accountability if you weren't to have a board?

Mr Stapley : I don't necessarily see that adding another layer of reporting between the CEO and the minister increases the accountability associated with the organisation. I can understand the arguments for and against. I just think that there are other options which could also have been considered which could potentially be more efficient.

Senator RICE: What other options?

Mr Stapley : Like having a statement of ministerial expectations being imposed, which is very clear about what the expectations of the minister would be of the agency. That would be another opportunity which wouldn't necessarily go to the expense of an industry funded board, and it would be a cost-recovered board, which our members would ultimately bear the costs of.

Senator RICE: Any other options other than the statement of expectations?

Mr Stapley : We think that there are potentially a range of options, including the status quo; using the executive management of the APVMA; reporting directly to the minister; the statement of expectations—we just feel like there is the opportunity for further analysis of a range of options to make sure that we are selecting the option which offers the greatest net benefit for the community.

Senator RICE: If you've got any further information on the range of different governance options that you are considering, if you could provide them to us, that would be good.

Mr Stapley : Very happy to do so.

CHAIR: Mr Stapley, thank you very much for your time.

Mr Stapley : Thank you very much.

CHAIR: Safe travels to wherever you've come from.

Mr Stapley : Not very far!

Proceedings suspended from 12 : 44 to 13 : 29