Attachment A

 

Details of the Financial Framework (Supplementary Powers) Amendment

(Agriculture, Fisheries and Forestry Measures No. 1) Regulations 2023

 

Section 1 - Name

 

This section provides that the title of the Regulations is the Financial Framework (Supplementary Powers) Amendment (Agriculture, Fisheries and Forestry Measures No. 1) Regulations 2023.

 

Section 2 - Commencement

 

This section provides that the Regulations commence on the day after registration 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

 

Financial Framework (Supplementary Powers) Regulations 1997

 

Item 1 - In the appropriate position in Part 4 of Schedule 1AB (table)

 

This item adds one new table item to Part 4 of Schedule 1AB to establish legislative authority for government spending on a certain activity to be administered by the Department of Agriculture, Fisheries and Forestry (the department).

 

New table item 606 establishes legislative authority for government spending on the National livestock traceability reform to enhance agricultural biosecurity in relation to exports program (the program).

 

The program will deliver on the Government's election commitment to support the adoption of livestock traceability reforms, as stated in Backing Australian Agriculture (Building a Better Future). It was announced by the Minister for Agriculture, Fisheries and Forestry, Senator the Hon Murray Watt on 26 October 2022. The media release can be accessed at https://minister.agriculture.gov.au/watt/media-releases/biosecurity-budget-funding.

 

The program is part of the three-year measure Bolstering Australia's Biosecurity
System - protecting Australia from escalating exotic animal disease risks. This measure will provide $46.7 million over three years from 2022-23 to cover the following two traceability components:

• $26.6 million in 2022-23 to improve and enhance the national livestock traceability system; and
• $20.1 million over three years from 2022-23 to co-invest with states and territories to improve on-farm and off-farm traceability.

 

Legislative authority through table item 606 is required to support the first component. Funding to states and territories will be delivered from the Council of Australian Governments Reform Fund Special Account in accordance with the Federal Financial Relations Act 2009.

 

The traceability of livestock is crucial for both biosecurity and market access. The program is an initiative to improve and enhance Australia's livestock traceability database and supporting systems. This is to ensure they are nationally consistent, fit for purpose, and able to support faster emergency response (contact tracing and movement controls) and recovery of Australia's $65 billion agricultural export trade sector from an exotic disease incursion, such as foot and mouth disease and lumpy skin disease. Food manufacturing businesses and workers, and exporters, will benefit from a consistent national livestock traceability system that provides assurance on food safety and quality to meet Australian consumer and international export market expectations and requirements.

 

The National Livestock Identification System (NLIS) is the existing primary database for tracking livestock movements, including cattle, sheep, pigs and goats for food safety, disease control, animal welfare, and to meet market access commitments. The improvement and enhancement of the national livestock traceability database under the program will ensure an increased level of 'contact tracing' that is both efficient and effective at tracking individual level movements. This capability is limited under the current system, as the NLIS database has been in operation for over 23 years and is nearing the end of its maintainable life and has varying identification and reporting requirements. This poses a risk to future export market access and economic returns.

 

The Government funding commitment of $46.7 million for the overarching measure is contingent on a one-third co-investment and delivery commitment from both state and territory governments and industry. Funding of up to $26.6 million will be awarded to an appropriate industry organisation (or organisations) to improve and enhance the NLIS in order to mitigate the risk. Industry management of this database will be consistent with current arrangements for management of the NLIS and enable greater responsiveness to users and regulators. Given the co-funded nature of the system, selection of the final provider will be made by the Commonwealth in accordance with the Commonwealth Grants Rules and Guidelines, in consultation with state and territory governments and industry.

 

Key selection criteria will include:

*         demonstrated experience and ability to develop and successfully deliver a national system that provides for fit for purpose, future-focussed livestock traceability data capture, storage, management and distribution;

*         strong national stakeholder consultation and engagement skills and experience, including change management;

*         strong project/program management and delivery skills and experience; and

*         strong project/program governance skills and experience.

 

The faster and more accurately animals are traced, the better prepared and faster the response and recovery from a pest or disease outbreak. The outcomes for improvement and enhancement of the database through this funding include (but are not limited to):

• data quality and assurance;
• analytical and reporting capability;
• opportunities for automation of processes and reporting;
• support for regulatory compliance and enforcement activities;
• scalability to support current and future use requirements; and
• ability for integration and interoperability with other systems and platforms.

 

The department will deliver the program through an ad hoc grant process. Program administration will be undertaken by the department with support for grant administration from the Community Grants Hub and will be governed by the Commonwealth Grants Rules and Guidelines 2017 and the Public Governance, Performance and Accountability Act 2013. Grant opportunity guidelines will be developed and information about the program will be available on the department's website (www.agriculture.gov.au) and GrantConnect (www.grants.gov.au).

 

The delegate of the Minister for Agriculture, Fisheries and Forestry (the Minister) will be responsible for making the final decision about Commonwealth expenditure, taking into account the recommendations made by departmental officers. The delegate of the Minister would be an SES employee, or an acting SES employee, of the department, who would have relevant expertise in, and understanding of, agriculture policy, and be able to perform relevant functions in accordance with the Commonwealth resource management framework.

 

Expenditure decisions in relation to the program will not be subject to independent merits review as decisions will relate to the provision of an ad hoc grant to a certain service provider over other service providers. The Administrative Review Council has recognised that it is justifiable to exclude merits review in relation to decisions of this nature (see paragraphs 4.16 to 4.19 of the guide, What decisions should be subject to merits review?).

 

Persons who are otherwise affected by decisions or who have concerns about the program will be able to provide feedback to the department. The department investigates any complaints about the program in accordance with its complaints policy and procedures. If a person is not satisfied with the way the department handles the complaint, they may lodge a complaint with the Commonwealth Ombudsman.

 

Consultation processes are ongoing and build on previous work of industry and governments to improve Australia's traceability systems. Efforts to date include an industry-government co-design exercise, hosted between 12 August and 2 November 2022, with 32 stakeholder groups participating. This exercise provided an opportunity to identify and collate areas of reform for national traceability arrangements including the database. Overall, there is strong support from across governments and peak industry bodies for improving the national livestock traceability database and its associated arrangements and activities.

 

Consultation will continue throughout the grant program with states and territories, industry, and the livestock database administrator, Integrity Systems Company, to confirm the scope and program of work. Supporting governance arrangements including a committee of key stakeholders will be established to ensure stakeholder needs and expectations are considered to ensure the program is fit for purpose.

 

Funding of $46.7 million (which includes funding of $26.6 million in 2022-23 for the program) was included in the October 2022-23 Budget under the measure 'Bolstering Australia's Biosecurity System - protecting Australia from escalating exotic animal disease risks' for a period of three years commencing in 2022-23. Details are set out in Budget October 2022-23, Budget Measures, Budget Paper No. 2 at pages 44 and 45.

 

Funding for the 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 2022-23, Budget Related Paper No. 1.1, Agriculture, Fisheries and Forestry Portfolio at pages 24, 27 and 55.

 

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.

 

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 program provides funding to ensure that the livestock traceability database and tracking system is fit for purpose and nationally consistent, which would demonstrate the safety and quality of Australian food to key export markets.

 

 

Attachment B

 

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, Fisheries and Forestry Measures No. 1) Regulations 2023

 

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 powers in the FF(SP) Act to make, vary or administer arrangements or grants may be exercised on behalf of the Commonwealth by 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, Fisheries and Forestry Measures No. 1) Regulations 2023 amend Schedule 1AB to the Principal Regulations to establish legislative authority for government spending on the National livestock traceability reform to enhance agricultural biosecurity in relation to exports program (the program). The program is administered by the Department of Agriculture, Fisheries and Forestry.

 

The Government will provide an ad hoc grant of up to $26.6 million in 2022-23 to an appropriate industry organisation (or organisations) to support the improvement and enhancement of Australia's livestock traceability database and supporting systems. The National Livestock Identification System (NLIS) is Australia's system for the identification and tracking of livestock, including cattle, sheep and goats for food safety, disease control, animal welfare, and to meet market access commitments. The NLIS has been in operation for over 23 years and is nearing the end of its maintainable life and has varying identification and reporting requirements. This poses a risk to future export market access and economic returns.

 

Funding for the program will ensure Australia's livestock traceability systems remain contemporary and fit for purpose, and able to support faster emergency response (contact tracing and movement controls) and recovery of the agricultural export trade sector from an exotic disease incursion, such as foot and mouth disease and lumpy skin disease.

 

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 Katy Gallagher

Minister for Finance