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Senate Estimates: Rural and Regional Affairs and Transport Legislation Committee

Estimates & Committees
Lee Rhiannon 15 Oct 2012

Rural and Regional Affairs and Transport Legislation  Committee

Estimates hearings 15 October 2012

  • Senator RHIANNON
  • Senator Ludwig
  • Mr McNamara
  • Mr Tucker
  • Dr O'Connell
  • Senator NASH
  • Senator COLBECK
  • Ms Freeman
  • Dr Glyde

 Full transcript available here

Page 108

CHAIR: Senator Rhiannon.

Senator RHIANNON: Has there been an examination of the effectiveness of regional forest agreements in maintaining the Commonwealth's own environmental standards, including whether the protection offered to threatened species under the RFAs is equivalent to that offered under the EPBC Act?

Senator Ludwig: Are you sure that's not a question for Minister Burke?

Senator RHIANNON: No, no. It will—

Senator Ludwig: Can you give us some context?

Senator RHIANNON: It will be, but it is very relevant here as well—and I look forward to your answer.

Mr McNamara: Senator, as you would be aware, in the original set-up of the RFA process, comprehensive regional assessments were undertaken to provide a balance between conservation and production in the forest areas. The RFAs themselves are overarching frameworks and live beside the state environmental legislation. The RFAs themselves are also based on adaptive management so that, as processes change through the life of the RFA, they are able to maintain currency in terms of thinking around forestry practices both under ecologically sustainable forestry management and under changes in terms of listings that come for state legislation and also under the EPBC Act.

Mr Tucker: Senator, can I add to that response. This department is responsible for managing the five-yearly reviews in cooperation we SEWPaC, and those questions come up in those reviews. We look at the commitments and undertakings each jurisdiction gave in the RFA and ask them to report against those commitments in those reviews. Partly in response to your question, which is where the minister responded, is that this issue also came up in the Hawke review of the EPBC Act, which was to Minister Burke. Minister Burke has responded on behalf of the government to the Hawke review findings, and there is also further examination of amendments to the EPBC Act which I do not know the detail of because they are not in this portfolio. But clearly the satisfaction of the government in terms of threatened and endangered species is to the satisfaction of Minister Burke in his portfolio.

Senator RHIANNON: Do we conclude from that that the protection offered to threatened species under the RFAs is equivalent to that offered under the EPBC Act? Is that how you would summarise it?

Mr Tucker: It was the reason at the time when the EPBC Act became an act that that exemption was provided for in the legislation. I am not in a position to make a qualitative judgement on that now; that would be a matter for the environment department.

Senator RHIANNON: So you are saying that it was a case originally but you are not in a position to make the judgement now.

Dr O'Connell: It is quite clearly the intent that, as issues have changed under the EPBC Act and as management prescriptions for threatened species have changed under the EPBC Act and state legislation, that has been incorporated into the state forest management frameworks allowed for under the RFAs. So, as it was mentioned, the RFA's adaptive management is part of the mechanism. So you should not see any clash between the EPBC outcomes for threatened species under the rest of the EPBC regime and that which gets managed through the RFAs.

Senator RHIANNON: Minister, is it the government's intention to use the RFA as a model for devolution of Commonwealth environmental controls to state governments?

Senator Ludwig: No.

Senator RHIANNON: No?

Senator Ludwig: I said no.

Senator RHIANNON: Okay. Thank you.

Senator NASH: You are going to be an example to other ministers in the building if you keep this up!


Page 109

Senator RHIANNON: How does the proposed model for environmental controls differ from that of the regional forest agreement model.

Senator Ludwig: You would need to ask Minister Burke that one, I think.

Senator RHIANNON: I thought I would try.

Senator Ludwig: No luck.

Senator RHIANNON: Has DAFF sought legal advice on whether any compensation would be payable in the event that the collapse of the native forest woodchip market made regional forest agreements no longer viable?

Dr O'Connell: No. I would not see a prima facie case to do that either.

Senator RHIANNON: So no legal advice has been sought—

Senator Ludwig: No.

Senator RHIANNON: because you argue that there is no basis—

Senator Ludwig: The rest of it is hypothetical. You have asked a question. I have said no.

Senator RHIANNON: Okay. Thank you. Has DAFF calculated what amount of compensation would be payable in each RFA area were those agreements to be cancelled for any reason?

Senator Ludwig: No.

Senator RHIANNON: I want to check—and I have asked about this one before—the package that was paid out in Tasmania and specifically the $825,000. When I asked about it before, you said that there had been no referrals to the Australian Federal Police and that you had, I think, explained it closed any further investigations.

Dr O'Connell: We answered this before you attended this evening.

Senator COLBECK: Still no.

Dr O'Connell: A different sort of no.

Senator RHIANNON: Looking at some of the Western Australian experiences, does the department monitor whether the Western Australian government complies with its legally binding obligations contained in clause 95 of the Western Australian RFA?

Mr Tucker: Through the regular reporting requirements we would ask them to report against the particular provisions of the RFA. I would have to take on notice that specific clause. It is not before me.

Senator RHIANNON: Thank you. Staying with Western Australia, if the department finds the Western Australian government is in breach of its obligations under the RFA, what actions will the department take to ensure implementation?

Mr Tucker: The RFA itself contains clauses concerning where there are disagreements or where one party believes another party has not fulfilled its obligations, and that would be the first port of call in how we would address those issues.

Senator RHIANNON: Have any of those been activated?

Mr McNamara: Not to my understanding.

Senator RHIANNON: Is that specific to Western Australia or to RFAs in general?

Senator Ludwig: That is RFAs generally. As I understand it, none have been recently activated.

Senator RHIANNON: Sorry, could you repeat that?

Senator Ludwig: It applies to all RFAs. There is a mechanism within the RFAs themselves and to my knowledge the clause that was referred to by Mr Tucker has not been activated in recent times, in the last 12 months.

Senator RHIANNON: So we have not had problems in the past 12 months. Has it been activated at other times?

Senator Ludwig: That was only my recollection.

Mr Tucker: We will have to take that on notice.

Senator RHIANNON: I will come back to New South Wales. I am interested in the sawmill biomass fuel study. Under what program was that funded?

Senator Ludwig: Do you have a bit more information?

Senator RHIANNON: It is on your website under 'bioenergy'. It is a sawmill biomass fuel study that has gone to south-east fibre exports.


Page 110

Senator Ludwig: Whereabouts on our website?

Senator RHIANNON: It is at Doesn't ring a bell?

Dr O'Connell: No. I will have to take that on notice.

Senator Ludwig: Looks like they have announced one without me.

Senator RHIANNON: SEFI will not be happy—or maybe they will.

Ms Freeman: We will investigate that, but is there a specific question regarding that project?

Senator RHIANNON: Yes. I was interested in how it is being funded and what the conditions of the grant are. Has a report been put in? I understand money has been handed over, so I am interested in how this has been managed.

Ms Freeman: We will take that on notice and get back to you.

Senator Ludwig: It could easily have been one of the grants under the climate change research programs. We will take it on notice. We will then find out where it is in the process and what has been done to date—the who, what, where questions.

Senator RHIANNON: Could you just answer it in the general. What is the process when you hand over these grants? What are the reporting conditions and the time lines for reporting?

Dr O'Connell: If it is a grant, there would be contractual requirements to provide reports on the expenditure.

Senator RHIANNON: Are those contractual requirements consistent with all grants or grants above a certain amount?

Dr O'Connell: They would vary, but there would be consistent requirements to acquit on the expenditure as was agreed and within its time frame or report otherwise. They would be a fairly consistent package.

Senator RHIANNON: Do you mean by that that the actual conditions vary according to the grant and there is no consistency according to how much the grant is?

Dr O'Connell: It would depend on the nature of the project—what the time frame was, what the milestones were and the timing. But you would always have a requirement to report on milestones and acquittal.

Mr Tucker: It would depend a little bit too on the timing of the grant. In more recent times, we have looked to have more standardised instruction around agreements in accordance with the Commonwealth Grant Guidelines. But, if it were some years old, there could be a bit more variability.

Dr O'Connell: That is absolutely right.

Mr McNamara: It would also depend on the size of the grant. A small grant might have only one report at the end of the grant. But a multiyear grant might have interim reports for each financial year. So there are a lot of variables.

Senator RHIANNON: Will the report be made public?

Dr O'Connell: We will not be sure until we are clear about the report and the project.

Senator RHIANNON: Can you take that it on notice to inform the committee whether the report will be made public and, if so, when?

Mr McNamara: Yes.

Senator RHIANNON: Essentially the project, as I understand it, is about biomass for bioenergy at timber processing facilities? Considering you do not have the detail before you on that specific grant, could you provide details to the committee about what work that has been done in that area generally?

Mr McNamara: We will take that on notice.

Senator RHIANNON: Seriously—nobody here tonight is able to talk about biomass for bioenergy? Minister, is that not surprising considering that, periodically, your government has given emphasis to the whole issue of biomass and how it should be managed in terms of energy delivery? It has been quite controversial.

Senator Ludwig: If you ask a specific question, we will get you information on it. If you want to have a general discussion—

Senator RHIANNON: I did ask a very specific question.

Senator Ludwig: I know.

Senator RHIANNON: Then I generalised just to try to find out what is going on within the department about biomass for bioenergy.


Page 111

Senator Ludwig: I just wanted to find where this was. I have the website up. Do you want to take me through where you say this grant is?

Senator RHIANNON: We got it from

Mr Tucker: Is the grantee Enecon?

Senator RHIANNON: Mine stops at bioenergy. That is where we picked it up. The grantee is South East Fibre Exports.

Mr Tucker: I found a different one.

Senator Ludwig: There is a site with 'Preparing the forest industry for the future—bioenergy research'. It starts with 'Bioenergy currently contributes …' and lists six projects—forest based bioenergy generation in Australia, conversion of eucalyptus forest waste residues to biofuel and—

Senator RHIANNON: Any more information?

Mr Tucker: We are finding on the website the material I suspect you have before you. But I think, in terms of your particular question, there is no greater clarity here on the website, so I think we will have to take that on notice.

Senator RHIANNON: Thank you for taking it on notice—both the specific question and also the question about what the department is doing generally on the issue of biomass for bioenergy.

Dr O'Connell: The more general issue would be handled best in the Resources and Energy portfolio. RET is the department with main carriage of bioenergy.

Senator RHIANNON: Thank you, Dr O'Connell.


(Subject: Live animal exports)


Page 124

Senator RHIANNON: Minister, I am seeking some clarification about the circumstances surrounding the shipment of live export of cattle that ended up in Pakistan in controversial circumstances.

Senator Ludwig: Sheep.

Senator RHIANNON: Sheep, I am sorry. There have been some contradictory statements as to how sick those animals were. On 3 September on ABC Lateline it was stated that:

The department of agriculture says that the shipments are both infected with the disease scabby mouth.

Then on 15 October AAP reports—and this is the latest report that we are aware of—that the sheep were not affected. There had been an earlier report on 1 September that a veterinarian certificate of health citing Perth for ocean voyage was actually backdated nearly a month after the ship left, possibly, again saying the sheep were healthy. Could you clarify what you understand to be the health of the sheep was at different stages during their voyage?

Dr Glyde: I did not hear quite all of that but I could give you on notice the details of what was said. What you are quoting is a series of media reports that were made primarily in Pakistan but here as well and most of which were wrong. All along the Australian authorities and DAFF has maintained that the animals were healthy—they had no notifiable animal health diseases. Indeed, that subsequently has proven to be the case. I think was yesterday or the day before that the exporter Wellards put out a press release showing the results of the independent testing that had been done by a laboratory in the United Kingdom at the request of the High Court of the Sindh Province that demonstrated that the animals were healthy. Whilst they may have had scabby mouth, that was not a notifiable disease. They were free of all the diseases they have been accused of. If you like, I could put on notice the exact claims that have been made over the course of the last few weeks.

Senator RHIANNON: Could you do that from when they leave Perth, to Bahrain, the circumstances, and then to Pakistan?

Dr Glyde: Sure.

Senator RHIANNON: Minister, when the news broke about Pakistan and how those animals were being killed, Wellard were on The World Today stating that they had lost control of the process, whereas a few days earlier they had said that the facilities that these sheep were being taken to was actually world class and possibly better than the facilities in Bahrain. Could you outline how Pakistan was brought into ESCAS process from that point when the sheep could not be unloaded in Bahrain and then they were looking for a country to take them to? How was Pakistan brought into ESCAS process and then what happened to make Wellard say that they had lost control.


Page 125

Dr O'Connell: The loss of control was when the Pakistan government agency essentially took over physical control of the consignment. So the loss of control was simply that Wellards and the importers were no longer physically in control of those animals. Those animals were under the control of a Pakistani agency.

Senator RHIANNON: But do you acknowledge that the conditions were different from what Wellard had stated were the conditions just a few days earlier, when they spoke about how excellent it was.

Mr Glyde: The supply chain was approved through the ESCAS process, our regulatory process. I think we would leave it at that. What happened, though, was that, as the animals were moving through that approved supply chain, the local authorities from the Sindh province provided armed guards or police to enforce a ruling of the Sindh government to begin the culling of those sheep. The point at which armed guards or police turned up to the approved facility is the point at which Wellard lost control. I do not think anyone can expect to maintain control in that circumstance, and Wellard has reported that breach at that time.

Dr O'Connell: And so what we are looking at now is an investigation of that breach. Clearly, it is a potential breach of the ESCAS arrangements, but that is a separate issue from the assessment of the supply chain prior to that intervention by the Sindh authorities.

Senator RHIANNON: Minister, when you were interviewed about this on The World Today, you said the system was working. How can you say that the system is working when it clearly broke down from what we have just heard now from the secretary and there are those very worrying reports about how the animals were treated?

Senator Ludwig: I will get the regulator to go through that. But I will stand by my remarks: the system works.

CHAIR: I do not want to rush you, Minister, but it is 10.31 pm. We do only have a half an hour left for trade and market access.

Senator Ludwig: I think it is an important point and we should allow the regulator to go through the issue.

Mr Glyde: The obligation on the exporter is to have contractual arrangements in place to ensure that the supply chain has the key elements of control, traceability and treatment of all animals to international animal welfare standards, the OIE welfare standards. The regulator assessed the application that Wellard had put forward and found that it met all of those criteria, and so normal practices ensued. When there was some adverse media—and, as it turns out inaccurate media reporting in the Pakistani press—that led to some concerns being exhibited by the local government, not the national government which has the regulatory authority for the approval of the imports into that country. That is the point at which the ESCAS system broke down—sorry, not the ESCAS system broke down but the exporter lost control of those animals, essentially through force majeure, through the involvement of police or armed officials from the local authority.

Senator RHIANNON: But isn't it one of the problems with the ESCAS system that those international standards which you referred to are not enforceable? They are standards that are below our standards and they are not enforceable.

Mr Glyde: The international welfare standards are a requirement on the exporter. It is up to the exporter to make sure that the international animal welfare standards in relation to not just slaughter but through the treatment of all of the animals right throughout—from the point of departure into the importing country and right through to the point of slaughter—are looked after, and that is done through commercially contractual arrangements. We, the Australian government, do not have the authority, nor do we seek to have the authority, to regulate those practices in those other countries. It is done through the exporter having commercial arrangements and contracts with importers and others in the country.

Senator RHIANNON: But didn't the system also fail—

CHAIR: Senator Rhiannon, I am going to help you out here.

Senator RHIANNON: Can I ask one more?

CHAIR: We are going to move into trade and market access, so we will probably spill into this same area. So I am just going to ask Dr O'Connell: are there other officers that we need at the table now as well, or can some escape?

Dr O'Connell: I think, if we are moving into trade and market access, all the agricultural productivity people can escape.

CHAIR: I do not know how many times I have to give that code to the officers and you still all hang around. You deserve it when you get called back.

Dr O'Connell: Senator, just to pick up on the points that Mr Glyde was making—

CHAIR: Do not go away, Mr Glyde.


Page 126

Mr Glyde: I'm not going anywhere.

CHAIR: By the way, I watched your performance on TV and, like me, you've got a good head for radio.

Mr Glyde: Funny you say that, Senator. My wife says exactly the same thing.

Dr O'Connell: It was well done.

Mr Glyde: Can I just point out that we do not actually have the individual division that is responsible for live animal exports here with us. I understand there is going to be some further rounds of questioning in relation to live animals at some later stage. I will answer questions.

CHAIR: Okay. I think you are doing your best to answer questions. Why don't we just carry on.

Dr O'Connell: I was just going to make a point to Senator Rhiannon around the level of the trade. Under the tranche 1 countries so far, as at 14 September, there are around 851,000 sheep and nearly 25,500 cattle exported under the ESCAS arrangements. There has been that very significant issue with Pakistan, but other than that we have overwhelmingly had the processes operate to provide solid assurance of the OIE standards being maintained and control being maintained for traceability. So, when we say we believe the ESCAS system has worked and provided that level of assurance, we are talking from the basis of, as I say, 851,000 animals in terms of sheep and roughly 25,500 in terms of cattle. The Pakistani incident is absolutely regrettable, but it is clearly to do with government intervention in Pakistan. But we will certainly be treating it as a breach of the ESCAS system and following it through, as we do with others.

Senator RHIANNON: With this particular incident, wasn't there the previous breakdown in the process? When the Ocean Drover and, I think, the Al Shuwaikh arrive in Bahrain they are not allowed to dock. Part of the memorandum of understanding is that within 36 hours that the sheep are to be unloaded, and it failed at that point as well. So the voyage becomes very long and very stressful, Wellard does not have anywhere to unload them and then there is a scramble. I understand the government helped Wellard then bring Pakistan up to speed to be part of ESCAS. So my question first off is about the memorandum of understanding. Didn't that break down at the point when that boat arrived and that shipment arrived?

Dr O'Connell: The distinction between ESCAS and the memorandum of understanding—

Mr Glyde: The memorandum of understanding relates to agreements that are between the Australian government and the importing country in relation to animal health issues arising from the incidents in relation to the Cormo Express, where the basic intent of those agreements is for the receiving country to unload the animals even if they have animal health problems. In this particular case there was no formal rejection by Bahrain but there were issues in relation to the speed in which those animals could be unloaded at the time that the vessel turned up. Wellard decided that in the interests of animal welfare and because of that uncertainty, because there was no formal rejection by the Bahraini government, it would be sensible to move the animals on to an alternative destination, which was Pakistan. On the Pakistan approval, Wellard had been working for some time in preparing for that market, to have alternative markets to open up the trade as well. So what happened at that stage was that Wellard came forward with an ESCAS application and all the other formal parts of the regulatory process to come forward. DAFF assessed those and found that they had met the standards and therefore approved the movement of the animals to Pakistan.

Senator RHIANNON: How could you do that in Australia just in a matter of hours or days and assess that the system in Pakistan is up to scratch to qualify for ESCAS?

Dr O'Connell: The assessment is of a third party, so there is a third-party audit function. We are not inspecting in other countries ourselves; that is clearly not part of the ESCAS arrangements. So it is not government to government; it is not a government intervention in other countries. We are assessing and regulating the exporter. The exporter has to get a third-party audit undertaken, and that is what Wellard did in this circumstance.

CHAIR: I am going to have to get you to your last question, Senator Rhiannon





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