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Thursday, 30 June 1994
Page: 2422

Senator CHAPMAN (12.46 p.m.) —Following its introduction into the Senate, and on the recommendation of the selection of bills committee, the Plant Breeder's Rights Bill 1994 was referred to the Senate Standing Committee on Rural and Regional Affairs. On 30 May 1994, the committee presented its report to this chamber and recommended that the passage of the legislation should not be delayed. The Liberal and National parties take on board and, indeed, support the committee's two suggested amendments, to subclause 17(2) in relation to farmer saved seed, and subclause 22(3) in relation to the extension of plant breeder rights beyond 25 years, in that they provide safeguards against potential misuse of delegated legislative power and contribute to the transparency of plant breeder rights.

  The Liberal and National parties support this legislation with amendments, notwithstanding the fact that Senator Woodley—in a consistent approach, might I say, for the Australian Democrats, who opposed the 1987 bill—has tabled a dissenting report, as we might expect, given the Democrats' philosophical opposition to plant variety rights and plant breeder rights. But let us not forget that Senator Woodley has also given notice for a related matter concerning the wheat and coarse grain industry to be referred to the Senate Standing Committee on Rural and Regional Affairs. It seems to me that the Democrats are determined to attempt to return the grain industry to the Clydesdale era. The history of this bill and the debate on it has been long and controversial. Without wishing to prolong debate, it is necessary to take a brief look at the history to satisfy all concerned that this controversial issue has been thoroughly investigated.

  The existing Plant Variety Rights Act 1987 was the result of extensive public inquiry, debate and research which continued for something over 30 years. Debate has been extended since this legislation was introduced into the House this year and, indeed, is still continuing. The debate reflects clear differences in philosophical approach. In 1976, the Industries Assistance Commission recommended that legislation be put in place to ensure that Australia did not miss the boat in terms of available source materials for horticulture development. In 1979, the then Minister for Primary Industry in the Fraser government, Mr Nixon—might I say, a very good minister—drafted the first Plant Variety Rights Bill, which was introduced in 1981. Following extensive public scrutiny and comment, the bill was passed by the House of Representatives on 24 April 1982. However, subsequent debate in the Senate saw the bill referred to the Senate Standing Committee on National Resources, whose deliberations were interrupted when parliament was dissolved for the election on 4 February 1983. The committee's report was subsequently tabled on 10 May 1984 with two dissenting views.

  The Plant Variety Rights Bill was finally passed on 25 February 1987, almost five years after it was first introduced by Mr Nixon. But that passage was not until it was the subject of a Senate standing committee report and a 1986 federal government initiated inquiry conducted by Professor Alec Lazenby, the report of which was entitled Australia's Plant Breeding Needs, and is known as the Lazenby report. Major conclusions concerned the adequacy of the breeding effort, deficiencies and imbalances, options and alternatives to PVR, the likely impact of protection and the effect on publicly funded breeding programs. Many of the revisions of the original PVR legislation take into account Professor Lazenby's findings.

  In 1988 the plant variety rights scheme commenced as a response to the 1987 legislation. After five years of operation, in 1993 an evaluation of the PVR scheme was undertaken by a consultant, Dr Alistair Watson, for the Department of Primary Industries and Energy. Its major objective was to maintain and improve the plant breeding effort in Australia and to encourage the private sector to invest more in breeding.

  While giving the plant variety rights scheme a basic seal of approval, Dr Watson's strongest criticism of the PVR scheme was that its objectives as originally envisaged—that is, to stimulate private plant breeding and to fund public plant breeding—were not being met and were indeed acting as a disincentive to investment in plant breeding. Dr Watson made several recommendations whereby private plant breeding could be stimulated and the scheme's financial viability and effectiveness could be improved.

  In his second reading speech on this legislation, the minister advised that the bill brings Australian legislation into line with the UPOV convention. Australia signed the convention of the International Union for the Protection of New Varieties of Plants, commonly known as the UPOV convention, in Paris in 1978. The entry into force for Australia was 1 March 1989. The UPOV convention was subsequently revised in 1991 and the rewriting and renaming of the Plant Variety Rights Act 1987 was primarily to conform to the UPOV convention revisions. The Plant Breeder's Rights Bill 1994 makes amendments to the Plant Variety Rights Act 1987 which will be repealed. This 1994 bill gives effect in Australian law to the 1991 convention.

  In its recent consideration of this bill, the committee addressed the issue of the timing of the passage of this bill and Australia's accession to the 1991 convention. The Department of Primary Industries and Energy stated that it had received advice that the European Union and the United States of America are `poised' to enact national legislation in preparation for a session of the 1991 UPOV convention.

  The Australian Conservation Foundation's objection to this bill is in part on the basis that no other countries have acceded as yet to the 1991 UPOV convention. Eighteen of 24 member countries have ratified the 1991 amendment but as yet none have acceded. The department, I note, is of the view that the 1995 accession to UPOV by Australia will be concurrent with the accession of these countries. Australia has not ratified the 1991 UPOV convention as yet.

  It is my view that other countries being signatory to an international convention is not necessarily sufficient reason for Australia to become a signatory. However, the UPOV 1991 convention could well be the exception that proves that rule that I have laid down. Australia almost did miss the boat in terms of marketing opportunities arising from newly exchanged species because of the protracted debate on this issue.

  It would seem that in the PVR legislation's short history this country, particularly in its horticultural and nursery industries, has accrued enormous benefits. Many further benefits, some yet to be identified in yield performance and improved competitiveness, will accrue over time. The enactment of amending legislation in a domain where the majority of industries across Australia support it, albeit under the auspices of an international convention, is a positive move.

  It should be remembered that PVR protection in Australia allowed breeders in other countries to introduce their varieties to this country. New Zealand stole the march from Australia in many horticultural varietal developments because of the delay in introduction of the initial legislation in Australia. I well remember seeing in New Zealand the advances being made, just as one example, in apple and pear production, as a result of their stealing a march on us in this regard.

  Through intellectual property protection, the Plant Breeder's Rights Bill 1994 enables plant breeders to apply for and receive proprietary rights for new varieties of plants developed, as does the existing Plant Variety Rights Act 1987. In conjunction with protection provided by patents and trademarks, breeders are able to profit from their efforts.

  Australia is one of only three countries to have patents granted on plants. Australian plants have been patentable since 1976 and are subject to normal patent requirements. Thus breeders have the option in Australia of choosing patents or PBR to protect new varieties. Both PBR and patents, as forms of intellectual property law and protection, are voluntary. Both stimulate innovation and active research. Of the two, plant breeder rights is considered to be the most desirable as it favours farmers' rights and the public interest. Additionally, limited public interest provisions have resulted in very few patented varieties. Dr Lloyd's analogy of copyright at the recent hearings of the committee succinctly illuminated the advantage of plant breeder rights over patents.

  Notwithstanding the limited relevance of this bill for wheat growers, it is an area which I wish to address, given the significance of wheat growing in my state of South Australia. I must declare an interest as someone who has a potential beneficial interest in a wheat growing property.

Senator Panizza —Welcome aboard!

Senator CHAPMAN —`Welcome aboard,' says Senator Panizza. As he and I both know only too well, in recent years wheat growing has not been a very profitable or beneficial exercise. But we will hope there are better days ahead.

  Wheat breeding in Australia is a major enterprise. There are eight major wheat breeding institutions in the five wheat growing states. South Australia has two such institutions—Adelaide University's Waite Agricultural Research Institute established a formal wheat breeding program in 1925, and Roseworthy Agricultural College has undertaken variety testing since its inception in 1882. It has been responsible for many releases, from its first cross-bred variety, Daphne, in the 1920s to more recent disease resistant releases. The stated aim of this type of public sector breeding is to improve returns to the farm community. Lazenby concluded that, while the public sector should continue its role in plant breeding, the relationship and support of public and private sectors should be even-handed.

  The principal purpose of PVR is to provide stimulus for increased investment in plant breeding and to facilitate private sector investment and commercialisation. Previously, private companies were involved in plant breeding when their efforts could be protected by the use of hybrids which captured benefits for the commercial breeder. Hybrid crops such as sorghum fetch prices sometimes 300 per cent higher than wheat.

  There is currently little incentive for farmers to register wheat varieties under PBR in Australia. Under plant variety rights in the United Kingdom, however, there are some 77 varieties registered. Eighty per cent of wheat in Australia is sown from farm-saved seed, compared with 20 to 30 per cent in the United Kingdom. Climatic conditions in the United Kingdom are not conducive to saving seed and farmers there purchase certified seed, paying royalties on it. In Australia, where seed is saved, mainly due to favourable climatic conditions, distribution is informal and purchasing of certified seed rarely occurs.

  The real attraction of this PBR bill to the wheat industry is that it encourages the breeder to exchange material and bring in high yielding and high protein accumulating parental material for breeding. The new Plant Breeder's Rights Bill provides an incentive to do that and rewards breeders for performance. This is the first time that an incentive for private farmers has been addressed.

  The genetic gain outcome for Australia is not yet clear, given the relatively short—six-year—span in which PVR has operated in this country, and given the eight- to 10-year breeding cycle for wheat. However, PVR has increased the availability of an extended selection of genetic material and it can be expected that trends in Australia will mimic results in other regions. The United Kingdom has increased wheat yields by 77 per cent in 30 years of operation of PVR in that country.

  In October 1993 the Grains Council held a workshop on intellectual property rights for plants, which examined the purpose of PVR—that of providing stimulus for increased investment in plant breeding in Australia, with the goal of facilitating private sector investment and the commercialisation of public sector bred cultivars. Workshop participants included Dr Watson, Professor Lazenby and representatives from the Department of Primary Industries and Energy, the Grains Council, the National Farmers Federation, state farmers associations, the patents office and the Plant Variety Rights Advisory Committee.

  The legislation before us today received wide support from all of these groups and also from the Australian Wheat Board. Such legislative support, particularly from the Grains Council of Australia—which represents approximately 60,000 growers—and the National Farmers Federation, given its extensive involvement in the consultative process, cannot be discounted. Similarly these groups' support for the committee's amendments to clause 17 of this bill, dealing with the retention of farmers' privilege, which recognises the informal and practical distribution of seed within the sharefarming community through direct negotiation, also cannot be discounted.

  Finally, greater rationalisation of plant breeding in the public sector has been identified as the means to free resources for work on crops with known export potential. New crop developments require selection and breeding effort to achieve good production and market penetration. Poorly selected varieties will not attract adequate markets. This need for stronger marketing was the subject of a report commissioned by the Grains Research and Development Corporation in 1992. It recommended greater coordination between plant breeders and grain end users to ensure that crop improvement was tailored to market needs and that 10 per cent of the budget of the Grains Research and Development Corporation—that is, $1 million—was spent on crop improvement research.

  With the incentives provided by this bill, there is both opportunity and incentive for growers to obtain new varieties and to benefit from the commercialisation of their breeding efforts. A good example of commercial success in both production and marketing is of course the macadamia nut. A Queensland farming family was the first to be granted a PVR for two new varieties of macadamia nut in 1989. PVRs are currently available for over 90 plant species in Australia. First genera and species include varieties of the apple, macadamia nut, oil seeds, beans, cotton, grasses and kangaroo paw. These commercial successes earn millions in export dollars from just the macadamia, and potentially from tea-tree oil, and lend weight to the arguments for this legislation.

  Given the overwhelming support for this bill by the Grains Council of Australia, the Seed Industry Association of Australia, the Nursery Industry Association of Australia, and horticulturalists and farmers alike, and given that the Senate Standing Committee on Rural and Regional Affairs has addressed the remaining concerns in relation to farmer saved seed and extension of plant breeder rights beyond 25 years, along with my opposition colleagues I support the passage of this bill, with the adoption of the amendments proposed by the committee.

  I note that it is the intention of the government to introduce some 11 amendments to the bill at the committee stage but we have been assured that those amendments are merely of a housekeeping nature. I know that some questions were raised about farmer saved seed by Senator Panizza during the second reading debate. In endorsing this bill, I am assuming that the minister will, at the appropriate stage, be able to satisfactorily answer those questions. Therefore, on that assumption and, as I said, given the general support of the grain industry for this legislation, I indicate my support for it also.