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Wednesday, 1 December 2021
Page: 6956

Senator McKENZIE (VictoriaMinister for Emergency Management and National Recovery and Resilience, Minister for Regionalisation, Regional Communications and Regional Education and Leader of The Nationals in the Senate) (11:20): It gives me great pleasure to provide this second reading debate speech on behalf of the agriculture minister, David Littleproud, with respect to the Agricultural and Veterinary Chemicals Legislation Amendment (Australian Pesticides and Veterinary Medicines Authority Board and Other Improvements) Bill 2019.

Australians need access to safe and effective agricultural chemicals and veterinary medicines. They protect our crops, livestock and domestic pets; they safeguard our environment from invasive weeds and pests; and they meet consumer needs for things such as household insecticides. Agvet chemicals, as these products are commonly known, have brought long-term benefits to Australian agriculture by supporting increased productivity, better-quality produce and more competitive industries. It's important that the regulation of agvet chemicals continues to be streamlined to maximise the benefits for Australia. It's also imperative to ensure that the strong safeguards built into the regulation of agvet chemicals are not compromised.

Through a cooperative scheme with the states and territories, the Australian Pesticides and Veterinary Medicines Authority, the APVMA, is the national regulator of agvet chemicals up to and including the point of supply. The APVMA has an important role to ensure that agvet chemicals supplied in Australia are safe for people, animals, plants and the environment and don't adversely impact our trade market access. The APVMA needs to be both efficient and effective in its regulation of agvet chemicals, and I thank the senators who have made contributions today to that effect. The bill supports these objectives by streamlining regulatory processes, while strengthening vital protections for the health and safety of humans, animals and the environment.

Given its vital role, the APVMA also requires robust governance arrangements that reflect modern practices to ensure the accountability and performance of the regulator. The bill supports this critical outcome by establishing the APVMA board and ceasing the advisory board. Legislation underpinning the APVMA and agvet chemical regulation was developed in the 1990s, and we have announced a comprehensive review of the whole legislative framework from first principles. In the meantime, however, the chemical industry has made it clear that there are simple and non-controversial changes that could be done right now to improve the efficiency of the agvet chemical regulatory framework, reducing costs and increasing the speed with which farmers can get access to safe and effective chemicals.

The bill therefore includes measures to improve the administrative efficiency of the APVMA and promote quicker access to chemical products. This has been one of the key issues that industry, stakeholders and primary producers have raised with us as a government time and time again, and it's our government which is dealing with this. The measures in the bill reduce the regulatory burden for applications by increasing the APVMA's flexibility when dealing with minor errors in applications and for information that can be taken into account during an application. The bill will also enable the APVMA to choose, where appropriate, to use computerised decision-making as part of the process, thereby increasing efficiency whilst maintaining appropriate checks and balances. Computerised decision-making might be used, for example, in decisions involving an administrative check of an application.

The bill also makes changes to enable the use of new, simpler processes for assessments based on risk. Specifically, the bill provides for new prescribed approval and registration processes that will be quicker and less costly than those which are currently available, whilst ensuring that the chemicals assessed are safe and effective. These new processes will apply for those active constituents, chemical products and labels that require minimal or no assessment of technical information, and will retain the requirement that the product meet the relevant statutory criteria, including in relation to the safety of humans, plants, animals and the environment. This measure has the potential to free up the time of the APVMA assessors so they can focus on more complex assessments.

The bill removes the need for industry to undertake two unrelated reporting activities: one for levies based on chemical product sales and a second, more complex reporting activity on active constituent quantities. It simplifies and aligns these reporting processes based on the quantity and value of product sales. This significantly reduces reporting costs for industry without compromising the availability of information for our international reporting obligations and policy development needs. The chemical industry has been seeking changes to these burdensome reporting requirements for some time, and the bill delivers on those changes.

The bill also provides for incentives for registration holders to include on product labels certain uses of chemical products that they do not ordinarily register. Similar to the approaches applied internationally, the incentives in the bill operate by extending data protection periods on information for up to five years if certain priority users are included on the labels. These extensions would be prescribed in the regulations. Based on the experience of these incentives overseas, this will encourage more priority uses on labels, including minor uses where the costs of adding the use are not justified by the additional commercial returns to chemical manufacturers. This will significantly benefit Australian farmers. Don't believe Senator Ayres's rhetoric.

Other measures in the bill enable the holder of an approval or registration to vary the approval or registration while it is suspended. This will ensure that the issue identified that led to the suspension of the approval or registration can be appropriately rectified at the holder's request. The bill also makes changes to strengthen the integrity of the regulatory framework. To perform its role, the regulator of the APVMA has to rely on information provided to it by applicants. The bill provides the APVMA with a broader suite of sanctions that will allow it to proportionally respond to any false or misleading information it receives. This includes both administrative sanctions and civil pecuniary penalties. Industry understands the importance of increasing the range of compliance options available to the APVMA. The bill further bolsters the integrity of the system by harmonising the need to inform the APVMA of new information, including information that shows a substance may no longer meet the safety criteria across all holders and applicants. The bill also includes measures to improve risk communication about chemical products. This increases the integrity and transparency of voluntary recalls of agvet chemicals and modernises the legislation so the reporting obligations are very clear for persons recalling these chemicals.

Importantly, the bill introduces a five-person skill-based governance board for the APVMA. This board will provide the APVMA with additional skills and experience to deliver an increasingly accountable, efficient and effective organisation. Currently, all responsibility for the APVMA strategic leadership, governance and day-to-day operation rests with the chief executive officer. The CEO is therefore responsible for setting, implementing and monitoring the APVMA's policies without any other direct support. This is an unreasonable and unsustainable management burden on the CEO that is not effective or efficient for the APVMA's successful long-term operation and ongoing improvement. The board will be accountable as an authority under the Public Governance, Performance and Accountability Act. It will ensure the proper, efficient and effective performance of the APVMA's functions and determine the policies, objectives and strategies that the APVMA will follow. In addition, the board will play an important role in implementing the outcomes of the government's comprehensive review of the whole agvet legislative framework from first principles.

The board, appointed by the Minister for Agriculture, David Littleproud, will consist of a chair, the APVMA CEO and three other members selected on the basis of their skills. Board members will be appointed on a part-time basis. The CEO is included as an ex officio board member to support informed and collective decision-making and ensure the policies are effectively integrated into day-to-day operations. The APVMA will continue to deliver independent and evidence-based decisions. The board will oversee how the APVMA does its job by establishing and monitoring the framework under which it operates. Day-to-day administration and decision-making such as registering individual chemical products and undertaking compliance and enforcement activities will remain the responsibility of the APVMA's CEO. The APVMA is one of the few corporate Commonwealth entities that doesn't have a governance board to ensure corporate compliance and management accountability. All other Commonwealth regulatory entities with direct responsibility for protecting human life and/or health have governance boards. So this is a great reform.

The board model chosen by the government is comparable with other corporate Commonwealth entities and with private sector companies. Its proposed size, composition, role, functions, duties and powers conform to Commonwealth policies, as well as modern best practice guidance on corporate governance. Board members will be required to have appropriate qualifications, skills or experience in financial management, law, risk management, public sector governance, science and/or public health. The board will be able to establish committees to assist it perform its functions and exercise its powers. These committees will provide a mechanism to seek input from and engage directly with industry stakeholders and other experts as required.

The bill provides transparency around ministerial directions to the board. Any written directions made to the board by the minister will be notifiable instruments with the particulars and effects of these directions reported to the APVMA's annual report. The bill additionally requires a review of the operation of the board after four years to ensure it is actually being effective and efficient.

The bill also ceases the existing APVMA advisory board. The advisory board had no legislative power to direct a particular course of action and has not been operational since 2015. There are further measures in the bill clarifying meanings or addressing deficiencies or inconsistencies in relation to the regulation of agvet chemicals, which is great to see. These are largely minor issues; however, when considered together they improve the overall operational efficiency of the APVMA. The measures in the bill represent a considered approach to improving agvet legislation and have been developed through a program of engagement with all stakeholders. The board measures have been developed through a process of detailed, targeted consultation with stakeholders directly affected by the APVMA's governance. Other measures in the bill have also been consulted on publicly, and this has confirmed that these measures will deliver benefits to the industry, the regulator and the broader community.

The bill will improve the effectiveness and efficiency of the national system for regulating agvet chemicals while strengthening its integrity and positioning the APVMA to become a modern and sustainable regulator. It will ensure that safe and effective agvet chemicals continue to be available to our community now and into the future. A more efficient regulator will deliver flow-on benefits to the APVMA's clients, including improved client services and reduced regulatory burden, which will reduce the cost of doing business.

On behalf of the minister, I would like to thank all those involved. As has been noted in comments today by both sides of the chamber, this has been a long process and we believe we've got the settings right. The APVMA is a great example of our government's commitment to decentralised government services to the regions, closer to the communities that they serve. History has borne out that, whilst controversial at the time, moving the APVMA to Armidale has been a benefit not just to the agency but also to the broader community and hasn't actually resulted in some of the perceived challenges by those who opposed it. I would like to thank previous Minister Joyce and the current minister, Minister Littleproud, for ensuring that this fantastic bill gets the support of the Senate to hopefully pass today with amendment.

The DEPUTY PRESIDENT: The question is that this bill be now read a second time.