Details of the Financial Framework (Supplementary Powers) Amendment (Agriculture and Water Resources Measures No. 5) Regulations 2017
Section 1 - Name
This section provides that the title of the Regulations is the Financial Framework (Supplementary Powers) Amendment (Agriculture and Water Resources Measures No. 5) Regulations 2017.
Section 2 - Commencement
This section provides that the Regulations commence on the day after the instrument is registered on the Federal Register of Legislation.
Section 3 - Authority
This section provides that the Regulations are made under the Financial Framework (Supplementary Powers) Act 1997.
Section 4 - Schedules
This section provides that the Financial Framework (Supplementary Powers) Regulations 1997 are amended as set out in the Schedule to the Regulations.
Schedule 1 - Amendments
Item 1 - In the appropriate position in Part 4 of Schedule 1AB (table)
This item adds two new table items to Part 4 of Schedule 1AB to establish legislative authority for government spending on certain activities administered by the Department of Agriculture and Water Resources.
New table item 243 establishes legislative authority for government spending on the Livestock Global Assurance Program (the Program).
The Government will provide a grant of $8.3 million over four years from 2017-18 to support the implementation of the Program, an assessment and certification assurance system for operators (exporters and importers) and facilities provided through a third party. The Program delivers on the Government’s 2016 election commitment.
The objective of the Program is to give Australian exporters of livestock an alternative method of demonstrating their compliance with the Exporter Supply Chain Assurance System (ESCAS). ESCAS is the legal framework relating to the export of livestock contained in the Export Control (Animals) Order 2004. ESCAS governs exporters' obligations relating to the welfare of exported feeder and slaughter livestock across the entire supply chain in overseas market places from the point of disembarkation of livestock to the point of slaughter.
ESCAS was implemented in Indonesia in August 2011 in response to the footage of mistreatment of Australian livestock in some Indonesian abattoirs, and then progressively rolled out to all Australian export markets during 2012. ESCAS was designed to ensure that Australian livestock exported for feeder and slaughter purposes are handled in accordance with the international animal welfare standards and to provide a mechanism to deal with animal welfare issues when they occur, preventing the need for trade suspensions.
Under ESCAS, the exporter must demonstrate, through a system of reporting and independent auditing, that:
* animal handling and slaughter meets the World Organisation for Animal Health's animal welfare standards;
* the exporter has control of all supply chain arrangements for livestock transport, management and slaughter, and all livestock remain in the supply chain; and
* the exporter can trace or account for all livestock through the supply chain.
The Program is not intended to replace the requirements of ESCAS but to be an alternative method for exporters to demonstrate they are meeting these requirements.
The Program will strengthen the assurance sought through ESCAS by:
* providing independent, third party certification of Australian exporters, overseas importers and facilities such as feedlots, farms and abattoirs;
* undertaking regular audits and investigations of overseas importers and facilities; and
* enforcing compliance on its members.
The Program will verify that overseas importers and facilities are meeting ESCAS requirements, thereby removing the administrative burden on Australian exporters. This will also improve current arrangements whereby exporters appoint their own auditors and undertake their own compliance investigations before reporting to the Department of Agriculture and Water Resources.
In order to be eligible for funding, the Australian livestock export industry, coordinated by the Australian Livestock Exporters' Council, must demonstrate that it has met the pre-conditions placed on them by the Minister for Agriculture and Water Resources. These pre-conditions include majority industry support for the Program and a well-developed implementation plan that outlines how the Program will be financially viable after the funding is exhausted.
Payments will be made in instalments, with the first instalment paid to the Australian Livestock Export Corporation Ltd for the establishment of a not-for-profit organisation limited by guarantee (Livestock Global Assurance Program company). The company's membership will be open to exporters, importers, feedlots, farms, abattoirs and industry service providers, producers and their representative bodies, and non-government organisations such as the RSPCA. Once the company is established, the remaining payments will be made directly to the company.
Funding of $8.3 million was included in the 2017-18 Budget under the measure 'Livestock Exports Global Assurance Program' for a period of four years commencing in 2017-18. Details are set out in Budget 2017-18, Budget Measures, Budget Paper No. 2 2017-18 at page 62.
Funding to support the implementation of the Program is part of the election commitment 'The Coalition's Policy for a Stronger Agriculture Sector', released on 23 June 2016, which is available at www.liberal.org.au/coalitions-policy-stronger-agriculture-sector.
Funding will be provided by way of a non-competitive grant in accordance with the Commonwealth Grants Rules and Guidelines. The grant guidelines will be published at www.agriculture.gov.au/about/reporting/obligations/contracts. The grant recipient will be required to enter into a grant agreement with the Commonwealth, with payments dependent on the delivery of milestones in accordance with the grant agreement.
The Minister for Agriculture and Water Resources will be the final decision-maker for the grant expenditure. The details of the grant will be published at www.agriculture.gov.au/about/reporting/obligations/grants-reporting-requirements.
Decisions made in relation to this grant will not be subject to merits review due to the non-competitive and targeted nature of the grant.
Funding for this item will come from Program 2.1: Biosecurity and Export Services, which is part of Outcome 2. Details are set out in the Portfolio Budget Statements 2017-18, Budget Related Paper No. 1.1, Agriculture and Water Resources Portfolio at page 47.
Noting that it is not a comprehensive statement of relevant constitutional considerations, the objective of the item references the following powers of the Constitution:
* the trade and commerce power (section 51(i));
* the external affairs power (section 51(xxix)); and
* the express incidental power (section 51(xxxix)).
Trade and commerce power
Section 51(i) of the Constitution empowers the Parliament to make laws with respect to 'trade and commerce with other countries, and among the states'. The grants enabled by the Program will facilitate measures that will establish and support an industry-led, not-for-profit organisation to support Australia's live export industry in demonstrating compliance with ESCAS overseas. Facilitating the demonstration of compliance with ESCAS, which includes the requirement to certify overseas facilities, will enable overseas trade and commerce in livestock to be maintained.
External affairs power
Section 51(xxix) of the Constitution empowers the Parliament to make laws with respect to 'external affairs'. The grants enabled by the Program will assist Australian exporters to comply with the requirements of ESCAS in relation to overseas supply chain facilities, which are geographically external to Australia.
Express incidental power
Section 51(xxxix) of the Constitution empowers the Parliament to make laws with respect to matters incidental to the execution of any power vested in it by the Constitution, including the trade and commerce power in section 51(i). The grants enabled by the Program, by establishing and supporting an entity to implement the Program, have the purpose of fostering and encouraging overseas trade and commerce.
New table item 244 establishes legislative authority for government spending on the Agricultural Trade and Market Access Cooperation program.
The program is a key part of the Government's commitment in the Agricultural Competitiveness White Paper to improve access to premium markets and deliver better farm gate returns. The White Paper was released on 4 July 2015 and is available at http://agwhitepaper.agriculture.gov.au/.
The program objective is to open, improve and/or maintain access to overseas markets for Australian agricultural products by building stronger relationships with trading partners, neighbouring countries and international organisations.
Funding of $5 million is available for the program over four years from 2015-16. This includes $3.1 million for grants to eligible individuals and organisations and $1.9 million for cooperation activities undertaken by the Department of Agriculture and Water Resources.
The program focuses on supporting projects that aim to achieve the program objective by:
* undertaking research and development in collaboration with trading partners to help identify, use, open or improve mutually beneficial agricultural trade opportunities;
* working with overseas governments and international organisations to develop common regulatory and technical requirements and standards;
* building evidence to inform Australia's position on international agricultural trade policy and advocacy of standards;
* sharing technical expertise and research to increase trading partners' knowledge of Australia's biosecurity, food safety and compliance regimes and practices, and to increase their preparedness to respond to exotic pest and disease incursions;
* promoting good biosecurity risk management practices, improving scientific capabilities and strengthening surveillance efforts in trading partners and neighbouring countries; and
* helping Australia meet its international obligations such as commitments made under the World Trade Organization's Agreement on the Application of Sanitary and Phytosanitary Measures.
Individual projects can receive grant funding for a minimum of $49,500 and up to a maximum of $1.5 million. The department will accept applications for program funding at any time until 31 December 2018 or until all funds have been allocated. Applications opened in March 2016. The program has no set funding rounds, and all agreements, payments and project activities should be finalised before 30 June 2019. The projects may take place in Australia or overseas.
Funding of $185 million over four years from 2015-16 for a package of measures to open up premium markets and strengthen Australia's agricultural competitiveness, including $5 million for the program, was included in the 2015-16 Mid-Year Economic and Fiscal Outlook. Details are set out under the measure 'Stronger Farmers, Stronger Economy - improvements to access premium markets' in the Mid-Year Economic and Fiscal Outlook 2015-16, Appendix A: Policy decisions taken since the 2015-16 Budget at page 142.
Information about the program, including selection criteria and the assessment process, is contained in the grant program guidelines which are available at www.agriculture.gov.au/SiteCollectionDocuments/market-access-trade/atmac/atmac-grant-programme-guidelines.pdf. The Department of Agriculture and Water Resources will accept grant applications on an ongoing, non-competitive basis at any time until the end of the program (31 December 2018). Applications may also be sought by the department for projects that target and address identified gaps or challenges, or respond to an urgent trade need.
Applications are considered in the order they are received. If funds are not available, applications will not be considered. If funding for the year has been allocated, the application may be considered in the next financial year unless the program is in its final year. Any applications sought by the department are considered in isolation of the applications accepted on an ongoing, non-competitive basis and take precedence. An invitation to submit an application is not a guarantee that funding will be provided.
Applications are assessed by a five-member assessment panel comprising departmental officials with relevant experience. The assessment of applications follows a three-stage process involving evaluation against eligibility criteria, assessment criteria, and other assessment considerations. The department has appointed a probity officer to advise the assessment panel on probity matters and help ensure that all applications are assessed fairly, uniformly and transparently. Decisions in relation to each application are made without reference to the comparative merits of other applications.
The assessment panel makes recommendations to the First Assistant Secretary, Trade and Market Access Division (the program delegate) as the final decision-maker on whether to approve a grant or a targeted project. Funding decisions are made in accordance with the assessment process set out in the grant program guidelines and the applicable legislative requirements under the Public Governance, Performance and Accountability Act 2013 and the Commonwealth Grants Rules and Guidelines.
The program delegate is a delegate of the Minister for Agriculture and Water Resources for the purpose of approving grant expenditure and a delegate of the Secretary of the department for the purpose of approving expenditure from departmental appropriations.
Successful applications for grants and targeted projects are listed on the department's website at www.agriculture.gov.au/market-access-trade/atmac#funded-projects.
There is no merits review for decisions in connection with the approval of grants due to the non-competitive nature of the funding and targeted projects under the Program. Following the decision by the program delegate, applicants are advised of the outcomes of their applications in writing. Unsuccessful applicants can request feedback about their applications from the department.
Applicants who are dissatisfied with the way an application has been handled by the department can lodge a complaint with the program manager. The complaint will be reviewed by one or more independent areas of the department in accordance with the department's complaints policy and procedures. If the applicant is not satisfied with the way the department has handled the complaint, they may lodge a complaint with the Commonwealth Ombudsman.
Further information about the program is available at www.agriculture.gov.au/market-access-trade/atmac.
Funding for this item comes from Program 1.13: International Market Access (Stronger Farmers, Stronger Economy - improvements to access premium markets - cooperation activities), which is part of Outcome 1. Details are set out in the Portfolio Budget Statements 2017-18, Budget Related Paper No. 1.1, Agriculture and Water Resources Portfolio at page 37.
Noting that it is not a comprehensive statement of relevant constitutional considerations, the objective of the item references the trade and commerce power (section 51(i)) of the Constitution.
Section 51(i) of the Constitution empowers the Parliament to make laws with respect to 'trade and commerce with other countries, and among the states'. Grants can therefore be provided in connection with international trade and commerce. The grants will facilitate measures to open, maintain and improve access to international markets for Australian agricultural products.
Commonwealth Numbered Regulations - Explanatory Statements