Details of the Financial Framework (Supplementary Powers) Amendment (Agriculture, Water and the Environment Measures No. 3) Regulations 2020

 

Section 1 - Name

 

This section provides that the title of the Regulations is the Financial Framework (Supplementary Powers) Amendment (Agriculture, Water and the Environment
Measures No. 3) Regulations 2020.

 

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 a new table item to Part 4 of Schedule 1AB to establish legislative authority for government spending on an activity that will be administered by the Department of Agriculture, Water and the Environment (the department).

 

New table item 414 establishes legislative authority for government spending on the Australia-China Agricultural Regulatory Cooperation program (the program).

 

The program aims to enhance engagement with China's regulatory agencies and systems to support Chinese capacity building and progress Australian market access interests. The program also aims to meet the department's objective to 'increase, improve and maintain markets' by seeking to improve the agricultural trade relationship with China.

 

The program will be supported under two main streams of funding: collaborative research and engagement between Australia and China; and bilateral engagement with Chinese regulatory agencies and industry.

 

Research and engagement will improve capacity and understanding in areas such as biosecurity innovation, food safety management and resource management. Bilateral engagement will primarily be with Chinese industry and regulatory agencies such as the General Administration of Customs of the People's Republic of China, the State Administration for Market Regulation, and the National Health Commission and the Ministry of Agriculture and Rural Affairs of the People's Republic of China.

 

The department also intends to engage in collaborative initiatives with China through multilateral bodies such as the World Organisation for Animal Health (OIE), the Codex Alimentarius Commission (Codex) and Food and Agriculture Organisation of the United Nations (FAO) and bodies under the International Plant Protection Convention (IPPC) to influence international standards that support Australia's trade interests.

 

More specifically, the program will deliver on the following five objectives:

*         collaborative agricultural research: this includes programs to share technical insights and experience on respective agricultural production systems to mutually improve opportunities such as those relating to grain production and regulatory oversight approaches;

*         collaboration and engagement on biosecurity and food safety: this relates to knowledge exchange on respective systems and practices in biosecurity and pest and disease management in agriculture; food safety management relating to the standards setting process in China as well as chemical residue, food testing and hygiene requirements; and resource management of the world's fisheries through improved harvest strategies and standardised electronic monitoring of fishery fleets;

*         bilateral meetings and scientific exchange as part of bilateral fora between Australian industry and China's growing agricultural sector on topics such as the nutritional benefit to China's livestock of stockfeed produced in Australia;

*         international standards meetings: this includes workshops led by Australia and China, delivered through international standards bodies such as OIE, Codex and FAO and bodies under the IPPC to achieve improved implementation of international animal and plant health and food safety standards in China and the region;

*         cooperation to address non-tariff measures impacting trade in agricultural products: this relates to reducing impediments to wine trade by streamlining import-export requirements, knowledge exchange on best practice wine certification, and improved traceability and understanding of supply chain vulnerabilities.

 

Organisations that are likely to receive program funding include peak Australian agricultural and food industry bodies, Australian state and territory government agencies involved in agricultural trade and regulatory functions, and corporate Commonwealth entities, research and development providers, and universities with relevant expertise.

 

Activities undertaken by funded organisations to deliver the program objectives will include laboratory based and other collaborative research, staff exchanges, technical working groups and conferences, and hosting of relevant international meetings to support bilateral and regional collaboration on regulatory issues of significance to the Australian and Chinese regulators.

 

The program will benefit farmers, exporters, agricultural industries and suppliers, and regulators engaged in trade to China and the Indo-Pacific region.

 

The department will conduct annual, open competitive grant funding rounds with the first round expect to commence in early 2020-21. The grant process will be conducted in accordance with applicable legislative requirements under the Public Governance, Performance and Accountability Act 2013 (PGPA Act) and the Commonwealth Grants Rules and Guidelines 2017 (CGRGs).

 

Funding may also be allocated through a small number of ad-hoc grants in 2019-20 intended to address specific priority needs identified by either the department or Chinese counterpart agencies to enable opportunities to be taken up outside of competitive funding rounds each year.

 

It is anticipated that 10 to 20 grants of between $50,000 and $200,000 will be awarded each year. Each grant will be for a maximum term of 18 months. Progress reports will be required, commensurate with the size and term of the grant, with a minimum requirement for a detailed activity plan and budget plus final report on the funded activity and financial acquittal of the grant.

 

To be funded under this program, organisations will be required to meet eligibility requirements and proposed activities will be assessed against certain criteria. Eligibility and assessment criteria will be published in grant opportunity guidelines (the grant guidelines) that are consistent with the CGRGs. The grant guidelines will ensure consistent and efficient grants administration by providing a single reference source for policy guidance and other documentation such as administrative procedures, eligibility and assessment criteria appraisal processes and standard forms.

 

Recommendations for determining successful applications will be made by an assessment panel made up of policy and technical experts from within the department. Applications will be assessed on merit using the selection criteria published in the grant guidelines. The panel will then make a recommendation to the appropriate delegate in the department, who will consider the recommendations and approve the successful applications.

 

All final decisions for expenditure will be made by a delegate of the Minister for Agriculture, Drought and Emergency Management (the Minister's delegate). Administration and payment of the grants will be in accordance with the PGPA Act and CGRGs.

 

The guidelines will be developed for each ad-hoc grant awarded in 2019-20 and will support the objective of the program. Grants will be published on the GrantConnect website at www.grants.gov.au and delivered through the Community Grants Hub managed by the Department of Social Services.

 

Information about the grant opportunities will be published by the Community Grants Hub at www.communitygrants.gov.au and the grant award decisions will be published at www.grants.gov.au.

 

The funding decisions made in connection with this program will not be subject to independent merits review. A decision to approve funding will be based on the allocation of finite resources where only a proportion of eligible applicants may receive funding. The re-making of a decision under merits review would necessarily affect funding already allocated to other parties and would delay the implementation of the program. Such decisions are not considered appropriate for merits review. The Administrative Review Council has recognised that it is justifiable to exclude merits review in relation to decisions of this nature (see items 4.11 to 4.16 of the document What decisions should be subject to merit review?).

 

The department undertakes comprehensive consultations with a range of internal regulatory areas based on their existing knowledge of the domestic industry and the regulatory environment in China, through ongoing engagement with Australian industry through established consultation mechanisms, as well as through cross-government consultation with other entities, including the Department of Foreign Affairs and Trade and the Department of the Prime Minister and Cabinet. The department also has established technical and high level consultation committees with counterpart Chinese agencies. These consultations inform the design and development of the program.

 

Funding of $9.5 million was included in the 2019-20 Budget under the measure 'International Agricultural Cooperation' for a period of four years commencing in 2019-20. This includes funding of $4.7 million for the program for a period of four years commencing in 2019-20.

Details are set out in Budget Paper No. 2, Budget Measures 2019-20 under the Foreign Affairs and Trade portfolio at page 82.

 

Funding for the program will come from Program 3.13: International Market Access, which is part of Outcome 3.  Details are set out in the Portfolio Additional Estimates Statements 2019-20, Agriculture, Water and the Environment Portfolio at page 71.

 

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)); and

*         the external affairs power (section 51(xxix)).

 

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 funding will increase cooperation between Australia and the People's Republic of China on agricultural trade, regulation and research. In this way, the funding will support collaborative research and engagement between the countries to reduce regulatory costs associated with agricultural and agri-tech exports, in turn fostering and encouraging overseas trade and commerce.

 

External affairs power

 

Section 51(xxix) of the Constitution empowers the Parliament to make laws with respect to 'external affairs'. The external affairs power supports legislation with respect to matters concerning Australia's relations with other nations.

 

The funding will support Australia's engagement and cooperation with the People's Republic of China. In this way, the funding will support and strengthen the relationship that exists between the countries.

 

Statement of Compatibility with Human Rights

 

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

Financial Framework (Supplementary Powers) Amendment (Agriculture, Water and the Environment Measures No. 3) Regulations 2020

 

This disallowable legislative instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

Overview of the legislative instrument

 

Section 32B of the Financial Framework (Supplementary Powers) Act 1997 (the FF(SP) Act) authorises the Commonwealth to make, vary and administer arrangements and grants specified in the Financial Framework (Supplementary Powers) Regulations 1997 (the FF(SP) Regulations) and to make, vary and administer arrangements and grants for the purposes of programs specified in the Regulations. Schedule 1AA and Schedule 1AB to the FF(SP) Regulations specify the arrangements, grants and programs. The FF(SP) Act applies to Ministers and the accountable authorities of non-corporate Commonwealth entities, as defined under section 12 of the Public Governance, Performance and Accountability Act 2013. 

 

The Financial Framework (Supplementary Powers) Amendment (Agriculture, Water and the Environment Measures No. 3) Regulations 2020 amend Schedule 1AB to the FF(SP) Regulations to establish legislative authority for government spending on the Australia-China Agricultural Regulatory Cooperation program (the program). The Department of Agriculture, Water and the Environment (the department) has responsibility for the program.

 

Government funding will support collaborative research and engagement between Australia and China to foster and encourage overseas trade and commerce. The program aims to enhance engagement with China's regulatory agencies and systems to support Chinese capacity and progress Australia's market access interests.

 

It will do this through projects to support collaborative development and exchange of technical and scientific research, engagement on biosecurity policy and food safety standards development, participation in international standards-setting work and joint development of commercial approaches and solutions to navigate non-tariff measures impacting trade.

 

Organisations that are likely to receive funding include peak Australian industry bodies, universities, Australian state and territory government agencies and corporate Commonwealth entities. Activities undertaken by funded organisations to deliver the program objectives will include laboratory based research, working groups, staff exchanges, technical fora and meetings undertaken in both virtual and face-to-face forms.

 

Funding will be allocated through a small number of ad-hoc grants in 2019-20 intended to address specific needs identified by the department. Funding in 2020-21 through to 2022-23 will be through annual, open competitive grant rounds and targeted collaborative projects with Chinese government and industry.

 

The program will benefit farmers, exporters, agricultural industries and suppliers, and regulators engaged in trade to China and the region.

 

Human rights implications

 

This disallowable legislative instrument does not engage any of the applicable rights or freedoms.

 

Conclusion

 

This disallowable legislative instrument is compatible with human rights as it does not raise any human rights issues.

 

 

 

 

 

Senator the Hon Mathias Cormann

Minister for Finance