Commonwealth Numbered Regulations - Explanatory Statements

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Issued by the Authority of the Minister for Primary Industries and Energy

Sugar Cane Levy Act 1987

Sugar Cane Levy Regulations (Amendment)

Subsection 9(1) of the Sugar Cane Levy Act 1987 (the Act) provides that the Governor-General may make regulations for the purposes of the Act.

Section 4 of the Act defines 'sugar industry organisations' and provides for additional organisations to be prescribed for the purposes of this definition.

A rationalisation of the sugar industry organisations listed in Section 4 of the Act has occurred resulting in the establishment of three separate national organisations which are to be prescribed as "sugar industry organisations".

The New South Wales Cane Growers' Association and the Queensland Cane Growers' Association (now known as Canegrowers) are now represented by an umbrella organisation, the Australian Cane Growers' Council Ltd (ACGC). The activities previously carried out by the Co-Operative Sugar Millers' Association, the Proprietary Sugar Millers' Association, and the milling component of the Australian Sugar Producers' Association are now conducted by the Australian Sugar Milling Council Pty Ltd (ASMC). NSW milling interests are represented on the Board of the ASMC. The Australian Cane Farmers Association Ltd (ACFA) was formed to represent growers interests following the breakup of the Australian Sugar Producers Association.

Section 6 of the Act imposes a levy on sugar cane delivered by the grower to another person other than for storage on behalf of the grower.

Section 7 of the Act provides that the rate of levy may be prescribed but shall not exceed $0.10 per tonne.

Subsection 9(2) of the Act provides that before making regulations for the purposes of section 7, the Governor-General shall take into consideration any relevant recommendation arising out of consultations between the Minister and the sugar industry organisations.

The currently prescribed rate of levy under Regulation 3 of the Sugar Cane Levy Regulations is $0.06 per tonne.

Consultations with the Australian Cane Growers' Council Ltd represented by Canegrowers, together with the Australian Sugar Milling Council Pty Ltd and the Australian Cane Farmers Association Ltd, resulted in a submission to the Minister requesting that the rate of levy be increased to $0.10 per tonne, the maximum allowed under the Act, commencing for the 1992-93 season.

Section 30 of the Primary Industries and Energy Research and Development Act 1990 (the PIERD Act) provides for research levy money to be paid to Research and Development Corporations. The sugar research levy has been attached to the Sugar Research and Development Corporation (SRDC) with effect from 1 October 1990.

The Commonwealth Government contributes matching amounts to cover research expenditure recommended by the SRDC and approved by the Minister. In any one financial year the Commonwealth contribution is limited to 0.5 per cent of the gross value of production (GVP). Estimated Commonwealth expenditure for 1992-93 is $3.347 million. Increased funding to meet the estimated Commonwealth matching obligation in 1992-93 resulting from the proposed increased levy has been provided for in the Forward Estimates process.

As the industry's request to increase the levy accords with the Government's objective of encouraging rural industries to increase their contribution for research to 0.5 per cent of the industry's GVP, the minister agrees with the recommendations of Canegrowers on behalf of the ACGC, the ASMC and the ACFA. The increase in the prescribed rate of levy represents an increase from 0.17 per cent to 0.40 per cent of the industry's estimated GVP for 1992-93.

Details of the proposed regulations are set out below:

Regulation 1.1 provides that the Regulations shall commence on 1 June 1992.

Regulation 2.1 provides for the existing regulations to be amended.

Regulation 3 inserts new regulations after Regulation 2 in the existing regulations. Regulation 2A prescribes several sugar industry organisations for the purposes of the definition of "sugar industry organisations" in subsection 4(1) of the Sugar Cane Levy Act 1987.

Regulation 4 provides for Regulation 3 (Prescribed rate of levy) of the existing regulations, to be amended to increase the rate of levy applicable to leviable sugar cane to $0.10 per tonne.

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