Independent economic analysis has confirmed proposed fee and levy increases for Australia’s agricultural chemical regulator will hurt farming productivity and add to grocery prices, the peak body for the plant science sector says.
The Armidale based Australian Pesticides and Veterinary Medicines Authority (APVMA) consultation period on its proposed Cost Recovery Implementation Statement (CRIS) has now closed. CropLife Australia has lodged a submission outlining what it says are significant problems with the proposal, along with recommendations for a better funding model. The submission is underpinned by independent analysis from economics, policy and advisory firm ACIL Allen.
“The APVMA’s new cost recovery model creates risks to the productivity and international competitiveness of Australia’s agricultural industries,” CropLife Australia chief executive Matthew Cossey said.
“It will limit the ability of our farmers to grow the fresh produce needed to lower cost-of-living pressures created by food inflation while also resulting in an overcollection of fees, charges and levies from industry.
“A properly resourced, well-functioning regulator that can turn around assessments in a reasonable timeframe is firmly in industry’s interest, and we support the APVMA being equipped to do that job well. Our concern is not that industry should pay its share, it’s that this model gets the balance wrong.
“ACIL Allen’s analysis confirms what industry has been saying since July: the proposed fee structure is not proportionate, not evidence-based, and not fit-for-purpose.”
The ACIL Allen report found the shift to full upfront cost recovery for registration costs would deny farmers access to new products that, because of the size of the Australian market, were only marginally viable before the price increase. It also identified what Mr Cossey described as a “no-man’s land”, where registering a product, or a specific use, becomes uneconomical due to higher application fees, while that same use remains ineligible for access under a permit.
“Worse still, the impact will disproportionately affect productivity in smaller and specialty crops, especially in horticulture, where growing productivity is not only critical to Australian agriculture but essential for delivering cost-of-living relief,” Mr Cossey said.
“Last week’s Food for Thought analysis from ANZ brought to light the cost-of-living pressure that Australian families have been feeling at the checkout for years, with the price of vegetables rising almost 65 per cent since September 2017.
“This shows it is not just farmers who cannot afford this change but Australian families, from the cities to the bush.”
The analysis also noted that patents typically run for 20 years, but by the time a product is registered in Australia, nearly half that patent has already elapsed. With higher upfront fees proposed for that narrow window to recover costs, CropLife warns some products or uses may not be economical to bring to Australia at all.
“We look forward to working with Minister Chisholm, DAFF and the APVMA on proper engagement with industry and farmers before any final decision is made,” Mr Cossey said.
“There’s still time to get this right, and CropLife will keep offering practical suggestions to help get to a funding model that supports the APVMA, Australian farmers, and the competitiveness of the sector.”
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