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Thursday, 14 November 2002
Page: 6427

Senator BARTLETT (Leader of the Australian Democrats) (5:28 PM) —On behalf of the Australian Democrats, in particular my colleague with responsibility for agricultural issues, Senator Cherry, I speak to the Egg Industry Service Provision (Transitional and Consequential Provisions) Bill 2002 and the Egg Industry Service Provision Bill 2002. The bills were the subject of a brief committee report which, again, I think is a good example of the value of the Senate committee system. Rather than senators chewing up a lot of time in the Senate chamber, asking questions backwards and forwards in the committee stage, the committee was, in the space of a few hours, able to get a lot of facts from the department, the industry and from bodies with interests in the legislation and, from there, develop a report.

The Democrats have a couple of concerns with these bills and with the way in which the rationale has been put forward about what the bills are and are not about. It is a bit strange to the Democrats for the government and the opposition to suggest that these bills do not and should not have anything to do with animal welfare when one of the reasons provided in the majority report for this levy is that in part it is to address issues associated with negative consumer perceptions about the nutritional benefits of eggs and animal welfare concerns. So if we are passing bills enabling a levy to be put in place to address animal welfare concerns, it seems a bit strange to the Democrats that the government and opposition are saying that the bills do not have anything to do with animal welfare and that we should stop trying to raise animal welfare issues as part of it.

It is not surprising that there are negative consumer perceptions about the egg industry. Whilst I do not think that it is the worst industry in terms of the infliction of animal suffering, it probably is the most well known one in the public's mind. The public's reasonable instinctive concern with cramming a large number of birds into a small cage for their entire lives is very difficult to overcome. One wonders why consumers and producers are expected to fund a levy to overcome negative perceptions rather than perhaps to address the root of those perceptions, which is the fact that 92 per cent of the egg industry still operates out of cages. You can reduce the negative animal welfare implications of caged hens but you cannot remove the animal welfare problem while the cage exists.

The only way to fully address animal welfare problems is to get hens out of cages. That does not mean that there are no animal welfare problems with the other systems— that is, farm laid and free-range methods— but they can be addressed if they are done properly. You cannot properly address animal welfare issues while birds continue to be caged for their entire lives. That is not the utopian dream of a few tree huggers; it is a widespread approach that has been adopted by many countries, particularly in Europe, where cages are to be phased out over the next 10 to 15 years, at different rates in different ways in different countries. There is a clear move away from the cage. Any suggestion that the industry would collapse as a consequence has been proven wrong by the fact that that move is happening.

During the committee hearings one member of the committee seemed to think that animal welfare concerns interfered with consumers' ability to choose. It is true that you can choose between free-range and cage-produced eggs; although, as came out in the inquiry, the labelling of those eggs is not particularly clear and has not progressed very far—that is, whether eggs are accurately labelled as being produced from a caged-hen system. Choice and availability are not as clear-cut as that. Choice is dramatically hindered by the overpricing of eggs produced through the barn-laid and free-range systems. Because it is a boutique, niche type market, producers are able to price eggs far over the rate that reflects the extra production costs. As the Productivity Commission's report a number of years ago showed, once an adequate volume of production is reached, production costs from more animal welfare friendly systems such as a free-range system are fairly small per egg. Nonetheless, other concerns need to be addressed.

In many ways it is fair to say that this bill sets up a body that follows down the path of a few other primary industry bodies in recent years and to ask why there is a problem with this one. That is a fair argument but some accountability issues are coming to the fore. Accountability is not just about reporting requirements under the Corporations Law. I do not have any concerns in relation to that and I agree with the committee's assessment of that matter, but the issue is broader than that, particularly in terms of what still does not happen. We are passing legislation even though there is no full detail about what the constitution of the AECL will be or about the contract between that body and the government. Parliament's ability to oversee research priorities to ensure that the body operates in the way suggested—that is, as an industry-wide body rather than one that focuses on specific sectors—will be reduced because it is to be an incorporated private body outside of government control.

The Senate recently encountered such a problem when it passed a motion, which I moved, seeking a report by Livecorp, which is a similar body to the one we are about to create: an industry body created by statute. The government refused to table an animal welfare related report produced by Livecorp about conditions on a ship that was exporting animals. The government claimed that the report was held by the company, that it was a private organisation, that it was the company's report, that it was nothing to do with the government, and that the government cannot force it to provide or publish the report. That is a perfect example of the public and parliament being prevented from gaining access to materials that are critical to our ability to oversee the operations not just of that body but of the industry more widely.

Clearly, in the case of live exports, whatever view you take about them on an economic or animal welfare ground, there is public interest and parliamentary responsibility in being able to oversee how the industry is operating. The fact that a report about that issue was prepared by Livecorp, a private body created by statute, means that we apparently cannot access it, even through something that is supposedly significantly powerful—that is, the Senate's power to pass returns to order requiring the government to table documents.

Again, that is another example of where parliament's ability to scrutinise areas that are supposedly in our sphere of responsibility is being lost tiny piece by tiny piece and being ceded to agreements between state and federal governments and to agreements between the executive and industry bodies, with parliament being cut out of not just the process but the ability to scrutinise ongoing activities. There are genuine accountability issues here for the Democrats—and not specifically because this is about the egg industry as opposed to any other industry—and they need to be scrutinised bit more closely. There is a fair prospect that this will not be the last industry body established by statute that this parliament will be considering. The problem that we have identified needs further examination.

In relation to the issue of consultation, and Senator O'Brien flagged this, the information provided by the Egg Industry Association to the committee claimed that the proposal for the development of a promotion capability for eggs was the subject of a comprehensive national process of consultation with egg producers last year, as required under Commonwealth levy guidelines. They stated that it resulted in overwhelming levels of support by over 90 per cent of those who participated. In the government's explanatory memorandum it was claimed that the consultation was extended in order to ensure that all stakeholders were aware of the proposal and had the opportunity to provide comment. There should not have been any exclusions based on whether or not people were actually members of the Egg Industry Association.

Despite that, as Senator O'Brien noted, in the last couple of days I have received a flurry of phone calls to my office and petitions or letters from producers. I had 74—a couple more must have come to Senator O'Brien's office, because he said `76'—producers opposing this levy. If, as the Egg Industry Association says, there are only 344 commercial producers, and 76 of those have written in either saying they oppose the levy or, even more concerning, saying they were not aware of it, that raises some question marks about the validity or the veracity of the consultation process that occurred. Again, that needs to be probed a bit further because it appears to me—and as this has only come up in the last few days I have not had the opportunity to fully explore it—that these producers that have expressed concerns are of the smaller scale. One of the concerns expressed in relation to the bills was that they were basically going to be dominated by the big producers. The sudden triggering of concern in the last few days from, I believe, small producers reinforces the fear that the body will operate predominantly for the few large producers who dominate the industry and obviously enable them to dominate it even further.

That ties back to the animal welfare issue. Whilst many of the large producers have free-range or barn-laid alongside the caged systems—in some cases as part of the whole establishment—the fact is that they are doing that to cater to the small boutique market while seeking to continue to expand the intensive side of the industry, which is of course the caged hens. The complete failure of state ministers a couple of years ago to act to phase out the cage—instead entrenching it with an absolutely minimal increase in size—is something that should be condemned.

I find it ironic that the industry is now seeking that the parliament pass a bill to enable a levy to be imposed to help it promote itself better to overcome the negative public perceptions of the fact that it is still insisting on caged hens. It might make more sense and be cheaper in the long run for the industry not to have to impose levies to help it overcome a negative public perception image by getting rid of the problem that is causing the negative public perception, which is cramming all the birds into the cage. I suspect that if one did an economic cost-benefit analysis one might actually find that you would come out better in terms of dollars and cents at the end, and obviously the hens would come out a hell of a lot better.

The narrow-minded, short-term focus of the industry and their incredible reluctance to change, which I have witnessed over many years, in many ways works against their own long-term interests. The stubborn refusal to act to address what is widespread public concern about the ongoing widespread use of the battery cage is going to continue to dog the egg industry. I think that is self-evident. As senators might be aware, I have had an interest in this issue for a while. I still have some postcards in my office if you want me to autograph one! I think it is one that will continue, regardless of whether I continue to campaign on it, because it provides a clear, easy focus for people. Most people have a general, inherent dislike of seeing animals suffer. There is no more obvious and clear-cut symbol of a suffering animal than having a cage with three or four birds squeezed into it—which are unable to turn around, stretch and flap their wings—and having them caged for what is also a dramatically shortened life. I do not think you can ever overcome the negative public perception about that, quite frankly, and I think it is ridiculous for the industry to impose a levy on themselves, and therefore the consumer, to help promote themselves out of a negative perception. I will not draw analogies because people will find them offensive, but it pretty much speaks for itself.

The promotion is also meant to deal with negative public perceptions about health issues relating to eggs. I am not going to get into a debate about whether eggs are healthy for you or not. Contrary to some media reports and perceptions, I am not a vegan; I do eat eggs from time to time, although not particularly regularly. There is certainly a significant body of credible scientific research that highlights health problems with egg consumption. The industry comes up with another body of credible scientific research that says eggs are really healthy for you and you should eat more. Indeed it gave evidence to that effect to the inquiry. There have been number of reports recently about egg consumption being linked directly to an increased risk of ovarian cancer. I cannot imagine that the industry is necessarily going to be out there promoting that in the public interest, but I suppose it is unrealistic to expect an industry to actually promote information that is against its own interests.

Again, it raises the question of the appropriate use of these levies. It is a levy that the industry wants to impose on itself. There are also arguments about whether the economics of generic promotion actually work. I think the evidence for that is fairly flimsy. However, if the industry wants to put a levy on itself to promote itself because it thinks it will work, who am I to argue with it? Let it do it and see how it works. I am pretty dubious, but if that is what it wants to do that is fine.

In conclusion, for the long term the Senate needs to have a closer look at some of the accountability or transparency issues that occur when we set up this type of body. When I use the word `accountability' I am not implying corporate wrongdoing, and that is why the Corporations Act provisions are fine; I am talking about transparency and the ability for the public and the parliament to know what the money is being used for, and that ability is weakened. There are obviously going to be ongoing issues in terms of animal welfare implications. You cannot run away and hide from that. You cannot just build nicer, cleaner and bigger buildings with better security systems to keep people like me out. The public will continue to be aware of the reality. I know egg producers continue to say that they are concerned about animal welfare and that they are building nicer facilities with temperature controls and all that. That is all well and good, but the fact is that the birds are still in very small cages with other birds for what passes as company. That basic fact cannot be overcome. Putting more and more research into ensuring hen welfare when they are going to continue to be in that system seems to me to be fairly pointless and a waste of money.

The fundamental point, and this is why it is an animal welfare issue from the Democrats' point of view, is that if this generic promotional levy does work, if it increases egg consumption and if it is only focused on a neutral industry-wide body then there is no doubt that, if it continues to include 92 per cent of the egg industry, it will be 92 per cent of a larger number of eggs. As a result of that, a larger number of birds will be in cages. In effect, people who buy free-range eggs will be subsidising that promotion to expand the caged egg industry. That is also a bit unfortunate. Having said all that, the bills will obviously pass. It is something that the industry—or parts of it—want and the ongoing scrutiny of the activities of this corporation, once it is established, is obviously something the Democrats will keep a close eye on.