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Estimates: Economics Legislation Committee: Treasury Portfolio: Inspector-General of Taxation

Estimates & Committees
Lee Rhiannon 14 Jun 2017

Tuesday 30 May

Senator RHIANNON: Did the Markets Group have a role in developing free-range egg information standards?

Mr Lonsdale : Yes, we did.

Senator RHIANNON: Could you please explain what the role was.

Mr Lonsdale : I will ask Ms Martin, who was very involved in that process to talk to you.

Ms Martin : The consumer affairs ministers agreed in March 2015, I think it was, to an information standard for free-range egg labelling. Treasury then undertook a RIS process, so there was a consultation process that was undertaken. We consulted with stakeholders, drafted the information standard and that information standard was registered just recently.

Senator RHIANNON: So it has been registered, and that is the one that allows 10,000 hens per hectare to be labelled as free-range—is that correct?

Ms Martin : That is the maximum outdoor stocking density, yes.

Senator RHIANNON: That is a misleading standard. What has been the interaction with the ACCC in setting up a misleading standard?

Ms Martin : I am not sure what you mean by 'misleading standard'.

Senator RHIANNON: Having that many hens per hectare has been widely recognised as overstocking and is not the equivalent of free-range. My question was about the interaction with the ACCC with regard to this.

Ms Martin : The ACCC will be enforcing the compliance on the information standard at a maximum stocking density of 10,000 hens per hectare.

Senator RHIANNON: How much contact did Treasury have with representatives of Egg Farmers of Australia and the Australian Egg Corporation regarding the development of the standard?

Ms Martin : They were consulted in the development of the standard.

Senator RHIANNON: When were you meeting with them?

Ms Martin : I would have to take that on notice.

Senator RHIANNON: Was it between the end of 2015 and leading up to March 2016?

Ms Martin : There would have been several meetings. I am not sure of the dates. I would have to take it on notice.

Senator RHIANNON: Did the Minister for Agriculture and Water Resources, or representatives of the minister, discuss the proposed information standard with small-business minister, Michael McCormack; Minister Kelly O'Dwyer; or any of your staff during this period?

Ms Martin : I am not aware of any discussions of that nature. I would have to take that on notice as well.

Senator RHIANNON: The final information standard contains five broad exceptions for providing meaningful and regular access to the outdoor range, and includes none of the factors that are relevant to determining the extent to which birds will access the range. What consideration was given to the new information standard actually making the ACCC's job in policing dodgy free-range claims even harder?

Ms Martin : Sorry?

Senator RHIANNON: What consideration was given to the new information standard with regard to the ACCC's job in policing free-range claims?

Ms Martin : A range of stakeholders' views were taken into consideration in developing the information standard, including consultation with ACCC.

Senator RHIANNON: To what extent was the ACCC kept informed of the development of the information standard?

Ms Martin : They were kept closely informed.

Senator RHIANNON: So, like, whenever you would have a meeting, you would update them—share all of the minutes and that sort of thing?

Ms Martin : Yes. They are also represented on the consumer affairs forum for Australia and New Zealand.

Senator RHIANNON: Did the ACCC express a view to Treasury about the proposed information standard?

Ms Martin : They provided a number of different comments and views throughout the process on the development of the information standard.

Senator RHIANNON: Was that at variance with 1,500 hens per hectare?

Ms Martin : The information standard has a maximum stocking density of 10,000 hens per hectare.

Senator RHIANNON: Was it at variance with that?

Ms Martin : That was a decision of ministers, 10,000 hens per hectare. That decision was made by consumer affairs ministers, and that is what we were instructed to implement.

Senator RHIANNON: Has the ACCC made any indications to Treasury that the proposed information standard may make enforcement of free-range claims more difficult?

Ms Martin : Not that I am aware of.

Senator RHIANNON: That would be fairly significant because enforcement is now where it is at. Do you need to take it on notice or are you aware of it?

Mr Lonsdale : I think we are clear.

Senator RHIANNON: You are clear that they did not?

Mr Lonsdale : Yes. To the best of our knowledge, that is right.

Senator RHIANNON: When I hear 'best of our knowledge', it is often code for—

Senator Cormann: There is no code. It is very straightforward. I reject the implication, of you suggesting that this is code. It is a very direct and straightforward answer.

Senator RHIANNON: What level of consideration did the markets group give to the fact that 68 per cent of Australians buy free-range eggs for animal welfare reasons and to support true free-range-eggs producers?

Ms Martin : The information standard was not about animal welfare, it was about providing consumers with clear information on the types of eggs that they were buying, to be in line with the decision made by consumer affairs ministers.

Senator RHIANNON: But you have just said that it was to provide information to consumers. Much of the research shows that consumers buy free-range eggs for animal welfare reasons. Wouldn't that be relevant, to take that into consideration?

Ms Martin : We were implementing an information standard where the broad parameters had already been agreed by consumer affairs ministers, including 10,000 hens per hectare—which might be considered an animal welfare issue, but we were not open to changing that.

Senator RHIANNON: The animal welfare issue did not come into it when you were working out what the stocking level should be?

Ms Martin : We did not work out what the stocking level should be; ministers agreed that.

Senator RHIANNON: In terms of what your input is not taking into account on animal welfare issues—

Ms Martin : No, animal welfare issues go to the model code for poultry. That is an issue for the agriculture department.

Senator RHIANNON: Are you referring to the CSIRO voluntary code there or to another code?

Ms Martin : I think it is a voluntary code, yes. It is under review at the moment.

Senator RHIANNON: So the CSIRO voluntary code of practice—

Ms Martin : I am not sure if it is a CSIRO voluntary code, but there is a model code for poultry.

Senator RHIANNON: I have a question on the CSIRO voluntary code, so I will just ask that. The CSIRO voluntary code of practice for free range egg-stocking densities has been at 1,500 per hectare for quite a while. Do you know for how long that has been in place and does it still exist, or has the government done away with it? I know that it is not your area of work, but, considering Treasury has been giving advice on this, I would have assumed that you would have gained advice from within government. What I am trying to determine is what advice you have gained from other departments that you have then based your recommendations on.

Ms Martin : As you said, we are not responsible for the model code for poultry. I understand that that is being reviewed at the moment. In terms of how long it has been in place for, I would need to refer that question probably to the department of agriculture.

Senator RHIANNON: Just to finish up: when you are undertaking this work, I imagine you are looking at other jurisdictions. Have you come across any other jurisdictions which determine that 'free range' can be a stocking level up to 10,000?

Ms Martin : Other jurisdictions?

Senator RHIANNON: Other countries.

Ms Martin : I am not aware of any other countries that have a maximum stocking density of 10,000 hens per hectare.

Senator RHIANNON: Did you look at other countries?

Ms Martin : I am aware that there are different stocking density levels in our countries, yes.

Senator RHIANNON: What are they—the ones that you looked at?

Ms Martin : I would have to take that on notice.

Senator RHIANNON: Do you know of any free range egg accreditation scheme in other countries and what their maximum is?

Ms Martin : We would have looked at those things in informing consumer affairs ministers, but I would have to take on notice what they actually are.

Senator RHIANNON: I imagine you would agree that it would be very significant, considering that the most controversial aspect of this whole decision was the maximum level. You would have information on it. Is that correct?

Mr Lonsdale : What Ms Martin is saying is that we would have information. You are right, Senator. These are the sorts of issues that would be brought to ministers attention in making decisions, but we do not have a comprehensive list of acreage for free range hens across countries here. If you would like that, we are happy to take that on notice.

Senator RHIANNON: Thank you.


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