Commonwealth Numbered Regulations - Explanatory Statements

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PRIMARY INDUSTRIES LEVIES AND CHARGES COLLECTION AMENDMENT REGULATIONS 2003 (NO. 11) 2003 NO. 305

Section 8 of the Primary Industries (Excise) Levies Act 1999 (the Levies Act), section 8 of the Primary Industries (Customs) Charges Act 1999 (the Charges Act) and section 30 of the Primary Industries Levies and Charges Collection Act 1991 (the Collection Act) provide that the Governor-General may make regulations prescribing matters required or permitted by those Acts to be prescribed or necessary or convenient to be prescribed for carrying out or giving effect to each Act.

The purpose of the regulations is to implement a marketing and research and development (R&D) levy and export charge scheme for the papaya industry. The levy and export charge will be imposed on papaya directed to fresh domestic and export markets and the domestic processing market and payable by papaya producers, processors or exporters as appropriate.

Horticulture Australia Limited (HAL) is the relevant industry services body for the regulation of the papaya industry. It co-ordinates marketing and R&D programs for many horticultural industries and will be the body to manage moneys for the levy and export charge scheme for the papaya industry. HAL is funded by statutory levies and export charges, voluntary contributions and Commonwealth Government matching funding for eligible R&D expenditure. This matching funding is provided under the Horticultural Marketing and Research and Development Act 2000.

Primary Industries (Excise) Levies Regulations 1999

Subclause 4(1) of Schedule 15 to the Levies Act provides that regulations may fix rates of levy for marketing purposes.

Subclause 4(3) of Schedule 15 to the Levies Act provides that regulations may fix rates of levy for R&D purposes.

Subclause 6(4) of Schedule 15 to the Levies Act provides that before the Governor-General makes regulations to fix rates of levy for marketing, the Minister must take into consideration any relevant recommendations made to the Minister by HAL.

Subclause 6(6) of Schedule 15 to the Levies Act provides that before the Governor-General makes regulations to fix rates of levy for R&D, the Minister must take into consideration any relevant recommendations made to the Minister by HAL.

Subclause 6(7) of Schedule 15 to the Levies Act requires HAL to consult with the body that is the eligible industry body for the relevant horticultural product before recommending rates of levy for marketing to the Minister.

Subclause 6(8) of Schedule 15 to the Levies Act requires HAL to consult with the body that is the eligible industry body for the relevant horticultural product before recommending rates of levy for R&D to the Minister.

Subclause 6(9) of Schedule 15 to the Levies Act requires that a recommendation made by HAL to the Minister be accompanied by a written statement of the views of the industry body consulted in relation to the recommendation.

The Regulations prescribe the Australian Papaya Industry Association (APIA) as the eligible industry body with which HAL must consult in relation to papayas. HAL recommended the initial operative rates of levy and export charge to the Minister after consultation with the APIA. The Regulations give effect to the recommendations of HAL, which are consistent with the papaya industry's request.

Subclause 2(4) of Schedule 15 to the Levies Act provides that regulations may exempt certain horticultural products from levy.

Primary Industries (Customs) Charges Regulations 1999

Subclause 3(3) of Schedule 10 to the Charges Act provide that regulations may fix rates of export charge for marketing purposes.

Subclause 3(5) of Schedule 10 to the Charges Act provides that regulations may fix rates of export charge for R&D purposes.

Subclause 5(3) of Schedule 10 to the Charges Act provide that before the Governor-General makes regulations to fix rates of export charge for marketing, the Minister must take into consideration any relevant recommendations made to the Minister by HAL.

Subclause 5(5) of Schedule 10 to the Charges Act provide that before the Governor-General makes regulations to fix rates of export charge for R&D, the Minister must take into consideration any relevant recommendations made to the Minister by HAL.

Subclause 5(6) of Schedule 10 to the Charges Act requires HAL to consult with the body that is the eligible industry body for the relevant horticultural product before recommending rates of export charge for marketing to the Minister.

Subclause 5(7) of Schedule 10 to the Charges Act require HAL to consult with the body that is the eligible industry body for the relevant horticultural product before recommending rates of export charge for R&D to the Minister.

Subclause 5(8) of Schedule 10 to the Charges Act require that a recommendation made by HAL to the Minister be accompanied by a written statement of the views of the industry body consulted in relation to the recommendation.

Primary Industries Levies and Charges Collection Regulations 1991

The Collection Act specifies no conditions that need to be met before the power to make Regulations may be exercised.

Schedule 22 to the Primary Industries Levies and Charges Collection Regulations 1991, sets out the details for payment of levy and export charge, provision of returns by liable persons and other collection matters for various leviable horticultural products.

The Regulations would also:

•       prescribe APIA as the eligible industry body to be consulted by HAL before making recommendations to the Minister about levy and export charge;

•       impose a statutory marketing and R&D levy and export charge on papaya directed for sale on fresh domestic or fresh export or processed domestic markets;

•       set an initial operative marketing levy and export charge of 1 cent per kilogram(/kg) and an initial operative R&D levy and export charge of 1 cent/kg on fresh papaya and 0.25cent/kg on processed papaya, payable at first point of sale. The moneys raised will to go to HAL to fund marketing and R&D. The Commonwealth will match eligible expenditure by HAL on R&D on a dollar for dollar basis;

•       exempt from levy papayas sold by the producer by retail sale where the amount of levy payable on papayas sold this way would be less that $50; and

•       provide for the manner of payment of levy and export charge, the provision of returns by persons who become liable to pay the levy and export charge and the keeping of records.

The Office of Regulation Review was consulted in the preparation of the Regulations. A Regulation Impact Statement is attached, as annex "A".

Details of the regulations are set out in Attachment A.

The regulations would commence on 1 January 2004.

0310985A
0310985B
0310985C

ATTACHMENT A

THE PROPOSED PRIMARY INDUSTRIES (EXCISE) LEVIES AMENDMENT REGULATIONS 2003 (No. 15)

Regulation 1 provides for the name of the regulations to be the Primary Industries (Excise) Levies Amendment Regulations 2003 (No. 15).

Regulation 2 provides for the commencement date to be 1 January 2004.

Regulation 3 provides that Schedule 1 amends the Primary Industries (Excise) Levies Regulations 1999, (the Excise Levies Regulations).

Schedule 1

Item 1 inserts a new Part 22 about papaya into Schedule 15 to the Excise Levies Regulations.

Clause 22.1 provides definitions for use in the part.

Clause 22.2 provides that papayas are leviable horticultural products for the purposes of the definition in clause 1 of Schedule 15 to the Levies Act.

Clause 22.3 specifies that papaya are exempt from levy where a producer sells papaya by retail sale in a levy year and the total amount of levy that the producer would be liable to pay in a year on papaya sold by retail sale would be less than $50.

•       Note provides a cross-reference to the definition of retail sale.

•       Note indicates that levy is not imposed by Schedule 15 to the Excise Levies Act on leviable horticultural products that are exported from Australia.

Clause 22.4 sets an initial operative rate of marketing levy on fresh papaya of 1 cent per kilogram (/kg).

Clause 22.5 sets an initial operative rate of R&D levy of 1 cent/kg on fresh papaya and 0.25 cent/kg on papaya sold or used by a producer for processing.

Clause 22.6 provides that the Australian Papaya Industry Association is the eligible industry body for papayas.

THE PROPOSED PRIMARY INDUSTRIES (CUSTOMS) CHARGES AMENDMENT REGULATIONS 2003 (No. 9)

Regulation 1 provides for the name of the regulations to be the Primary Industries (Customs) Charges Amendment Regulations 2003 (No. 9).

Regulation 2 provides for the commencement date to be 1 January 2004.

Regulation 3 provides that Schedule 1 amends the Primary Industries (Customs) Charges Regulations 2000, (the Customs Charges Regulations).

Schedule 1

Item 1 inserts a new Part 22 about papaya into Schedule 10 to the Customs Charges Regulations.

Clause 22.1 provides that papayas are chargeable horticultural products for the purposes of the definition in clause 1 of Schedule 10 to the Charges Act.

•       Note indicates that charge is not imposed on papaya that have had levy previously paid on them.

•       Note advises that clause 22.2 is intentionally not used.

Clause 22.3 sets an initial operative rate of marketing charge on papaya of 1 cent/kg.

Clause 22.4 sets an initial operative rate of R&D charge on papaya of 1 cent/kg.

Clause 22.5 provides that the Australian Papaya Industry Association is the eligible industry body for papayas.

THE PROPOSED PRIMARY INDUSTRIES LEVIES AND CHARGES COLLECTION AMENDMENT REGULATIONS 2003 (No. 11)

Regulation 1 provides for the name of the regulations to be the Primary Industries Levies and Charges Collection Amendment Regulations 2003 (No. 11).

Regulation 2 provides for the commencement date to be 1 January 2004.

Regulation 3 provides that Schedule 1 amends the Primary Industries Levies and Charges Collection Regulations 1991, (the Collection Regulations).

Schedule 1

Item 1 inserts a new Part 22 about papaya into Schedule 22 of the Collection Regulations.

Clause 22.1 provides that the part applies to papaya.

Clause 22.2 provides definitions for use in the part.

Clause 22.3 provides that a levy year for papaya is a financial year.

Clause 22.4 prescribes operations that are not considered processes in relation to papayas.

Clause 22.5 defines who is a processor of papaya

•       Note identifies a processor to be the proprietor of the processing establishment that processes the product, unless immediately before delivery, the proprietor of another processing establishment (who is then defined to be the processor) owns the product.

Clause 22.6 defines who is a producer of papaya.

•       Note 1 clarifies that a producer can be the person who owns the product immediately after it is harvested (as defined in paragraph (b) of the definition of producer in the Collection Act. Papayas are prescribed for the purposes of that definition).

•       Note 2 identifies the person who exports chargeable horticultural products, in this case papayas, from Australia as a producer.

Clause 22.7 prescribes papayas for the purpose of subsection 7(3) of the Collection Act in relation to the liability of exporting agents.

•       Note indicates that exporting agents are liable to pay, on behalf of producers, unpaid charge and late payment penalty.

Clause 22.8 prescribes papayas for the purpose of subsection 7(2) (b) of the Collection Act in relation to the liability of processors.

•       Note indicates that processors are liable to pay, on behalf of producers, unpaid charge and late payment penalty.

Clause 22.9 prescribes that the last day for lodging a return is the 28th day of the month following the quarter.

•       Note indicates penalties can be imposed for late payment.

Clause 22.10 prescribes the following persons who deal in leviable or chargeable papayas in a quarter and who must lodge a return for a quarter:

A person who buys papayas in the quarter;

A buyer agent who buys papayas in the quarter;

A selling agent who sells papayas in the quarter;

An exporter who exports papayas in the quarter;

An exporting agent who exports papayas in the quarter;

A processor who processes papayas in the quarter;

A producer who sells papayas other than by retail sale in the quarter;

•       Note indicates offences may be applicable.

Clause 22.11 provides that a quarterly return must be lodged within 28 days of the end of the quarter to which it relates.

•       Note indicates offences maybe applicable.

Clause 22.12 prescribes the charge or levy payable on papayas for a levy year is due for payment on 28 August in the following year.

•       Note indicates penalties can be imposed for late payment.

Clause 22.13 specifies that a producer who sells leviable papaya by retail sale in a levy year must lodge an annual return.

•       Note indicates offences may be applicable.

Clause 22.14 prescribes that an annual return must be lodged by 28 August in the next levy year.

•       Note indicates offences maybe applicable.

Clause 22.15 stipulates what must be included in a quarterly or annual return.

•       Note indicates offences maybe applicable.

Clause 22.16 stipulates what records must be kept by producers. A penalty of 10 penalty units is provided for breaches of the regulations. Section 4AA of the Crimes Act 1914 provides that a penalty unit equals $110.

•       Note indicates where definition of strict liability can be found.

Clause 22.17 stipulates what records must be kept by first purchasers, agents and processors. A penalty of 10 penalty units is provided for breaches of the regulations.

•       Note indicates where definition of strict liability can be found.

Clause 22.18 stipulates what records must be kept by exporters and exporting agents. A penalty of 10 penalty units is provided for breaches of the regulations.

•       Note indicates where definition of strict liability can be found.

Background

Internationally fruit from Carica papaya has been generally known as papaya. In Australia fruit from Carica papaya are referred to as papaya or papaw (often spelt pawpaw or paw-paw).

The Australian Papaya Industry Association (APIA) is the peak body representing the papaya fruit industry in Australia. The Australian papaya industry comprises approximately 200 producers located in 6 principal production regions across QLD, WA and the Northern Territory. The principal production region for papaya is in the northern tropics in the Innisfail and Atherton Tablelands regions of Queensland. Approximately 90% of Australian production is from Queensland. Traditionally papaya was grown in south-east Queensland and in the Yarwun region of central Queensland. Over the past 15 years, the production has shifted dramatically north to the Innisfail, and more lately to the Atherton Tablelands regions. Production also occurs in the Northern Territory, principally in the Humpty Doo area, and in Western Australia, in the Kununurra and Carnarvon regions. Value of production in Australia is estimated at $18 million. Production in Queensland is around $16 million (Queensland Fruit and Vegetable Growers and Queensland Department of Primary Industry), $600,000 in the Northern Territory and $1.2 million in Western Australia (WA Department of Agriculture).

1.       Problem to be addressed

While there has been a papaya industry in Australia for many years it is still a relatively immature industry that has undergone a significant regional shift in the past 20 years. The traditional production regions have suffered a series of fluctuations in production levels including rapid expansion in recent years. The industry suffers from these fluctuations in production particularly in terms of consistent supply to the market and the associated problems with consumer loyalty. The industry was funding R&D and marketing programs to counter these issues using Queensland state compulsory levy funds. However, this expired on 30 June 2003 and was replaced by a voluntary scheme with significantly reduced participation.

There is currently under-investment in M&P and R&D because of the `free rider' problem. This is where consumers and producers receive benefits from M&P and R&D but do not (or will not) pay for these identified benefits. This has resulted in under-investment in these activities by the papaya industry.

This unwillingness by the papaya fruit industry to invest in M&P and R&D has resulted in market failure, characterised by:

-       Low rate of adoption of production best-practice;

-       inadequate papaya marketing information evidenced by the high domestic market focus and the main papaya variety produced not being well known;

-       lack of consumer knowledge of papaya fruit characteristics and shelf life;

-       less than optimal adoption of sustainable environmental management practices, and;

-       farm and supply chain quality management systems not being developed.

Without the implementation of a compulsory levy such R&D would not occur because there is no return on investment to be gained by the funding organisation. In addition to this, Papaya production is trending up at an estimated 10% per annum and additional activities will be required to maintain returns to growers in light of the increased production and predicted increases in imported fruit coming on to the market from Fiji and the Philippines.

2.       Objective of the Regulations

The objective of the regulations is to increase R&D and marketing activities in the papaya fruit industry for the benefit of growers, consumers and the community using funds derived by a statutory levy paid by papaya fruit growers. Currently there is little or no investment in these areas of the industry due to the lack of return on investment obtained by those in a position to fund the various activities.

The Australian Papaya Industry Association has identified the key issues confronting the Papaya Industry and formulated a whole of industry strategic plan.

The key issues and activities include:

•       To double average per capita consumption over the next five year and generally increase demand for papayas in existing and potential new markets.

•       Agree on and implement a generic coordinated promotional marketing program.

•       Conduct a comprehensive market investigation program.

•       Stimulate innovation to develop and deliver new products.

•       Accelerate the rate of adoption of best practice.

•       Establish supply chain alliances to create production efficiencies and build critical supply capabilities.

•       Develop and implement industry standards, product quality guarantees and assurances, and business models.

•       Increased industry focus on responsible environmental management practices.

•       Increase the rate of adoption of the outcomes from R&D and market development projects.

The desired outcome from proposed R&D and M&P programs in the Papaya Industries five year business plan include:

•       An improvement in papaya quality resulting in an increase in the average sale price of $1 per carton.

•       An increase of exports and development of new exports of up to 100,000 trays per annum.

•       An increase in annual domestic consumption of fresh papaya by 0.8 kg per capita.

3.       Identification of options to achieve objectives above

Existing Compulsory Queensland R&D Levy

The Australian Papaya Industry has benefited significantly from the compulsory R&D levy imposed on Queensland growers by Queensland Fruit and Vegetable Growers (QFVG). This investment in R&D and M&P has contributed significantly to the industry doubling its size over the last 10 years expanding production regions. However this levy is inequitable because papaya growers in other states and the NT have not contributed in proportion, to fund papaya industry development programs. In addition, the QFVG levy became voluntary on 30 June 2003, with the sunset of State Legislation and the implementation of the new QFVG structure. It has been suggested that the voluntary levy will not be supported by growers due to the inequity associated with providing funding on a voluntary basis to a commodity based market in which those who have not contributed within the industry will still benefit. It is predicted in both R&D and M&P that the `free rider' syndrome would cause the breakdown in a voluntary scheme and this will impact significantly on the industry's ability to maintain R&D and M&P programs.

Voluntary levies

As noted above, voluntary contributions have not been recommended by the industry because of the potential for some growers to act as `free-riders', failing to contribute while gaining the benefit of the marketing and R&D activities. The evidence of this is that to date in Western Australia and the Northern Territory the industry has relied on information disseminated from the Queensland industry, or on research funded from State agencies.

Industry cooperatives/marketing groups

There are no regional and national marketing cooperatives or marketing groups that contribute to R&D or M& P. In general the industry has been unsuccessful in funding R&D or M&P activities for the broader industry or community benefit. However, the industry is generally very interested in any publicly funded R&D and market development programs.

Private research providers

There is very little research in the areas of papaya crop management and supply chain management which affects natural resource sustainability, crop forecasting, consumer research or export market research. In addition, there is little if any privately funded research conducted in the areas of plant breeding, crop regulation and the improved post handling of product. This is largely due to the problems associated with the free rider concept. In addition to this, the size and inconsistency of the market and lack of regularly available funds is a barrier to the formation of a specific private research industry.

Proposed Compulsory National Levy

A new statutory levy is proposed for the Australian papaya industry. The new levy will apply nationally, and will enable the industry to fund research & development (R&D) and marketing & promotions (M&P) programs.

The essential aspects of market failure in the papaya industry will be assisted by the provision of R&D and M&P that is jointly funded by the compulsory industry levy and charge and via the Commonwealth R&D matching payment scheme. This would ensure that all who benefit from the R& D and M&P pay for it either as papaya producers, papaya consumers or taxpayers.

It is proposed that a new domestic excise levy and export charge be implemented at a rate of one cent per kilogram for M&P and one cent per kilogram for R&D on fresh fruit at the first point of sale. A rate of $2.50 per tonne will be charged on fruit used for processing. The introduction of R&D levies for fresh and processed fruits are proposed to fund on farm and post-harvest research, development and extension projects. The introduction of a M&P domestic levy and export charge is proposed to fund marketing and promotion programs for both domestic and export markets.

4.       Impact analysis

Likely Cost Impacts

Papaya producers will pay:

•       Research & Development domestic levy and export charge of one cent ($0.01) per kg on all varieties of fresh market domestic papaya and papaw (fruit from the species Carica papaya) collected at the first point of sale.

•       Research & Development levy of $2.50 per tonne on fruit destined for processing.

•       Marketing & Promotion domestic levy and export charge of one cent ($0.01) per kg on all varieties of fresh market domestic papaya and papaw (fruit from the species Carica papaya) collected at the first point of sale.

The proposed papaya levy is based on a crop of 16,000 tonne, split 95% fresh and 5% processing, is estimated to raise the following funds:

	R&D levy	M&P levy
Domestic-fresh	$160,000	$160,000
(1 million cartons at 1
cent/kg)
Domestic Processing	$2500	$0
(est. 1000 tonnes at
$2.50/tonne)
Less levy collection	($7,000)	($7,000)
costs (est. based on
similar fruit industries)
Matching government	155,500
funding*
Available funding	$311,000	$153,000

*R&D programs are matched $ for $ by the Federal Government.

Levy collection costs are estimated at 4% of gross levy receipts. The levies will be collected in the same fashion as other horticultural levies and by agents familiar with the system. The start-up costs are estimated to be around $14,000.

Horticulture Australia overheads are approximately 10% of net R&D levy receipts, and 10% of net marketing levy receipt, for externally commissioned projects.

Industry consultation costs are of the order of 10% of total program funds, as provided for in HAL Board guidelines, and subject to the Commonwealth Guidelines on industry consultation funding.

It is not expected that the imposition of the levy will have a significant impact on consumer process. Transferring the total cost of the levies onto consumers would add approximately one cent to each papaya. However, future R&D and M&P activities funded by the levies should lead to the availability of better quality produce possibly at higher prices and increased consumer demand for papaya.

Likely Benefits

The Australian Papaya Industry Association believes the levies and export charges will benefit all papaya fruit growers in the industry as well as consumers and the general community. Papaya producers will benefit through improvements in orchard and supply chain efficiency, which will also allow domestic and export markets to be further developed. These benefits would include: potential reductions in production and marketing expenditure; improved productivity, and; increased domestic and export sales.

For consumers benefits could potentially include: improved product quality and food safety; greater consistency of supply, and; potentially a more stable price range of papaya fruit.

The broader Australian population would also benefit by the expansion of the industry generating employment, investment, improved natural resource management and environmental sustainability, including reduced land degradation and more efficient water use and worker safety. .

The new levy will raise approximately $160,000 to be used to fund research and development (R&D) programs and $160,000 marketing and promotion (M&P) programs for the industry. The quantum and break-up of the new levy is based on extensive experience in strategic and program management under the Queensland system.

The benefits of the proposed statutory national papaya industry levy are likely to significantly exceed levy costs, including collection and other administrative costs. The benefit/cost ratio of promotional programs for other industries such as stone fruit has been in the range of 3:1 to more than 20:1. For example, the public relations work with food media currently undertaken by Horticulture Australia at a costs of $35,000 per annum has consistently yielded media coverage estimated in excess of $750,000 per annum. This is also supported by public relations activities undertaken by Queensland Fruit and Vegetable Growers, where food media public relations has consistently yielded media coverage of greater than 20 fold of the dollar value invested.

For the projected collection and investment of $320,000 per annum of levy funds the targeted average net return from the proposed papaya levy over the five years of the business plan is $6.6 million per annum, comprising:

•       An improvement in papaya quality resulting in an increase in the average sale price of $1 per carton, resulting in an increase in return of $1.2 m per annum.

•       An increase of exports and development of new exports of up to 100,000 trays per annum resulting in an increase in return of $1.8 m per annum.

•       An increase in annual domestic consumption of fresh papaya by 0.8 kg per capita (up to 1.6kg from 0.8kg) resulting in an increase in return of $3.6 m per annum.

This equates to a 20:1 return on investment.

Competition Policy

5. Consultation

The Australian Papaya Industry Association conducted a thorough consultation campaign throughout the industry in line with the Australian Government's levy principles and guidelines.

Queensland produces 90% of Australian papayas with 7% from WA and 3% from the NT. In order to consult as widely as possible with growers the Australian Papaya Industry Association visited all the principle production regions, and met with all known growers, either individually or as a group. Radio announcements and newspaper advertisements were used to advertise public meetings in the higher yielding areas, including Innisfail and Mareeba in northern Queensland. More commonly, flyers, telephoning and electronic communications were used to inform growers.

Following the series of regional meetings in October-November 2002, a levy proposal document was mailed to all known growers. Due to the transient nature of some growers, growers were also requested to advise if they had discontinued growing. While a ballot papers was sent to 265 growers throughout Australia, 36 growers advised (post or by facsimile/phone) that they no longer were growing papaya. Seven growers were identified from the Carnarvon and Kununurra regions of WA and three from the NT.

The ballot was undertaken in April 2003 and was independently managed by consultants Horticultural Communications P/L. Of the 229 ballots (265 less 36 where advised ceased growing), 78 returned votes were received prior to the close of the ballot.

The results from the 78 returned votes were as follows:

•       Industry support for research and development levy - 55 votes of valid votes cast (71%).

•       Industry support for marketing and promotion levy - 54 votes of valid votes cast (70%).

Information received from the Queensland Department of Primary Industries states that they believe there are only 160 to 170 commercial papaya growers in Australia.

In order to reach the maximum amount of potential levy payers HAL advertised the 90-day industry comment period following the levy proposal submission in the Good Fruit and Vegetables October issue. This magazine is a widely distributed, national publication. However it has been suggested that HAL provide a more targeted media strategy in future to ensure coverage. No concerns or objections were received from papaya growers during the comment period.

6.       Conclusion and recommended option

The proposed compulsory national papaya fruit levy and charge is regarded as the only effective means of funding R&D and M&P to correct the market failure that exists in the industry.

The proposal for a national statutory levy and export charge for R&D and M&P for the papaya industry:

•       conforms to the Government's levy guidelines and principles;

•       does not restrict competition,

•       has limited financial impact on the Commonwealth, and

•       has clear potential to benefit the industry.

The proposed levies are necessary because the existing compulsory contributions (Queensland only) ceased on 30 June 2003 and there are continuing issues of market failure to be addressed. The current levy collections and associated M&P and R&D activities to benefit the industry have proven inadequate to address many of the challenges such as natural resource management, increased production and supply chain issues facing the Australian papaya industry.

7.       Implementation and review

The levy is to be implemented as soon as practicable, depending on the legislative process. The proposed implementation date is January 2004. The APIA has conducted a full ballot of papaya levy payers to assess the level of industry support for the papaya levy.

A review of the Levy income and expenditure is planned to occur in 2008, as a five-year appraisal.