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2002
THE PARLIAMENT OF THE
COMMONWEALTH OF AUSTRALIA
HOUSE OF
REPRESENTATIVES
AUSTRALIAN ANIMAL HEALTH COUNCIL
(LIVE-STOCK INDUSTRIES) FUNDING AMENDMENT BILL 2002
EXPLANATORY MEMORANDUM
(Circulated by Authority of the Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry, Senator the Hon Judith Troeth)
AUSTRALIAN ANIMAL HEALTH COUNCIL (LIVE-STOCK INDUSTRIES)
FUNDING AMENDMENT BILL 2002
GENERAL
OUTLINE
The purpose of the amendments to the Australian Animal
Health Council (Live-stock Industries) Funding Act 1996 is to enable levies
and charges to be appropriated to the Australian Animal Health Council (AAHC)
known as Animal Health Australia (AHA) to be used to repay the Commonwealth for
underwriting livestock industries’ share of the costs of responding to
emergency animal diseases. The Bill also provides a mechanism for any excess
levies and charges that are collected to be appropriated to relevant industry
research and development bodies for research and development activities or the
promotion or maintenance of the health of animals.
The Government
approved the Emergency Animal Disease Response Agreement (EADRA) in March 2002.
The Government decision states that industry can repay any amounts paid for by
the Commonwealth on behalf of industry under the agreement, via a statutory levy
or charge. To allow the repayment arrangements via a levy to come into law, it
is necessary to amend the Australian Animal Health Council (Live-stock
Industries) Funding Act 1996. New emergency animal disease response levies
and charges will be imposed on participating animal industry signatories by
regulations under Schedule 27 to the Primary Industries (Excise) Levies Act
1999 and under Schedule 14 to the Primary Industries (Customs) Charges
Act 1999. At this stage, the new levy will be set at zero, with the
exception of the honey-bee industry. For all current signatories, except the
honey industry, this means that there will be no increase in the levy burden
from the outset. However, should an outbreak occur, there could be an increased
levy burden on levy payers in the affected industry.
Under the terms of
the EADRA, the AAHC will co-ordinate, collate and maintain financial information
in respect of any animal disease emergency. Livestock industries agreed that
the AAHC will receive and disburse levy funds to be used to repay the
Commonwealth for the costs underwritten by the Commonwealth on behalf of
industry. Several payments of levy or charge may be made to the AAHC in any
period. Relevant livestock industries will be advised of their total debt to
the Commonwealth by the AAHC and repayment arrangements will be implemented in
accordance with Schedule 7 of the Agreement. Once a debt is known, industries
will activate their emergency animal disease levy with all levy funds initially
flowing to the Consolidated Revenue Fund and subsequently disbursed to the AAHC.
The AAHC will manage the levy funds on behalf of the relevant industry or
industries in order to repay that industry’s debt to the Commonwealth.
The honey industry, however, has set an operative levy rate for the emergency
animal disease response levy and collection of this levy should commence on the
effective date of the regulations. Initially the honey bee industry will
establish a contingency fund with the AAHC into which all animal disease levies
will be deposited. The Amendment Bill allows for payments to be made to Plant
Health Australia on behalf of the Australian Honey Bee Industry Council for
plant disease emergencies/contingencies.
It will be impossible to time
the termination of the levy or charge at the precise moment the debt to the
Commonwealth has been fully paid. For this reason the Amendment Bill makes
provision for any excess funds to be re-directed to fund the promotion or
maintenance of the health of animals including through research and development
activities as requested by industry.
FINANCIAL IMPACT
STATEMENT
There are no direct financial implications for the
Commonwealth as the intention of the Bill is to facilitate the disbursement of
levies and charges to Animal Health Australia. However, indirectly the
arrangements will allow the repayment of monies to the Commonwealth expended on
behalf of animal industries under agreed cost sharing arrangements for responses
to emergency animal diseases. The impact on Commonwealth contributions to
industry research and development arrangements is expected to be
minimal.
NOTES ON CLAUSES
Clause 1: Short
title
This clause provides for the Act to be called the Australian
Animal Health Council (Live-stock Industries) Funding Amendment Act
2002.
Clause 2: Commencement
This clause provides for
Sections 1 to 3 of the Act (ie the commencement information) to come into effect
on Royal Assent and that the Schedule 1 (or the amendments to the existing Act)
will take effect on a date to be proclaimed as the precise timing will depend on
when changes to the Australian Animal Health Council’s company
Constitution will be made, which is expected to occur in November
2002.
Clause 3: Schedule(s)
This clause specifies that
amendments will be made to the Act or Acts mentioned in the schedule which is
provided. In this case amendments will be made to the Australian Animal
Health Council (Live-stock Industries) Funding Act 1996.
Schedule
1: Amendments relating to emergency animal disease response
Item 1
– Section 3
This item inserts a new definition into Section 3
of the Australian Animal Health Council (Live-stock Industries) Funding Act
1996 and provides a description of the Emergency Animal Disease Response
(cost sharing) Agreement.
Item 2 – Paragraph
4(b)
This item repeals the existing paragraph because the words in
the text indicate a reference to non-payment penalties. The clause then inserts
amended words which correctly refer to late payment penalties.
Item 3
– At the end of section 4
This item adds a new clause under the
existing Section 4 of the Australian Animal Health Council (Live-stock
Industries) Funding Act 1996 and provides for the payment of Emergency
Animal Disease Response (EADR) levies and charges as well as late payment
penalties to be made to the Australian Animal Health Council. The inserted
Clause also specifies that the Levies Revenue Service can deduct the cost of
collecting the EADR levies and charges and administering the levy arrangements
before levy and charge funds are paid to the Australian Animal Health
Council.
The Clause also provides for levies and charges to be paid to
the Australian Animal Health Council in order to discharge livestock
industries’ debt to the Commonwealth. The subsequent subclauses (4), (5)
and (6) describe how the Australian Animal Health Council will apply the levies
and charges. The application of the levies and charges is set out as priorities
and obliges the Australian Animal Health Council to apply the funds to meeting
the expenses of the Australian Animal Health Council in administering the
emergency arrangements and payments, acquittal of the industries debt to the
Commonwealth arising under the EADR agreement and paying any excess levy or
charge collected to an organization that is concerned with research and
development or to the promotion or maintenance of the health of animals to which
the animal product relates.
Sub-clause 5(a) applies to whether the animal
product is honey or anything else.
Item 3 - At the end of the
Act
This item provides for situations where refunds of levies charges
or penalty are applicable.
Subclause 6 refers to the Treatment of
Refunds. This clause sets out that, if the Commonwealth refunds levy or
charges, which has been overpaid by industry, then the Australian Animal Health
Council must also pay the equivalent amount back to the Commonwealth.
The
clause then refers to associated subclauses that will apply if this situation
arises.
Subclause 6 (4) also provides for the Commonwealth to set off any
refunds due to the Commonwealth from future payments to the Australian Animal
Health Council.