Referral of the inquiry
1.1
On 19 September 2019, the Senate referred the provisions of the Agricultural and Veterinary Chemicals Legislation Amendment (Australian Pesticides and Veterinary Medicines Authority Board and Other Improvements) Bill 2019 (the bill) to the Senate Rural and Regional Affairs and Transport Legislation Committee (the committee) for inquiry and report by 28 November 2019.
1.2
The Senate Selection of Bills Committee noted that the reasons for the referral were to investigate:
the impact of the bills on the regulation of agricultural and veterinary medicines products in Australia;
the cost of establishing the Governance Board and who will pay for the board; and
any other related matters.
Conduct of the inquiry
1.3
The committee advertised the inquiry on its webpage, and set 10 October 2019 as the closing date for submissions. The committee also wrote to a range of key stakeholder groups, organisations and individuals drawing their attention to the inquiry and inviting them to make written submissions.
1.4
The committee received 10 submissions which are listed in Appendix 1. Submissions were published on the committee's inquiry webpage.
Legislation Committee inquiry – Agricultural and Veterinary Chemicals Legislation Amendment (Streamlining Regulation) Bill 2018
1.5
The committee recently conducted an inquiry into the provisions of the Agricultural and Veterinary Chemicals Legislation Amendment (Streamlining Regulation) Bill 2018 (Streamlining Regulation bill). The committee's report was tabled in February 2019, and the Streamlining Regulation bill lapsed when Parliament was dissolved in early 2019. The bill currently being considered by the committee revives the measures from the lapsed bill.
1.6
Additional measures in the lapsed Streamlining Regulation bill would have provided for a legislative instrument made by the Australian Pesticides and Veterinary Medicines Authority (APVMA) to prescribe a scheme that would allow applicants and the APVMA to use accredited third party providers to undertake assessment services. This measure is not being pursued in the 2019 version of the bill.
References Committee inquiry – Independence of regulatory decisions made by the Australian Pesticides and Veterinary Medicines Authority (APVMA)
1.7
The Rural and Regional Affairs and Transport References Committee (References committee) recently undertook an inquiry into the Independence of regulatory decisions made by the APVMA – this report was also tabled in February 2019.
1.8
Given these inquiries were undertaken during 2018-2019, the committee resolved not to hold hearings in relation to the bill, but to complete the current inquiry and report, based on the submissions received.
Agricultural and Veterinary Chemicals Legislation Amendment (Operational Efficiency) Bill 2017
1.9
The Agricultural and Veterinary Chemicals Legislation Amendment (Operational Efficiency) Bill 2017 (Operational Efficiency bill), was introduced into the House of Representatives on 25 October 2017, and proposed amendments to the Agricultural and Veterinary Chemical Products (Collection of Levy) Act 1994, the Agricultural and Veterinary Chemicals (Administration) Act 1992 and the Agricultural and Veterinary Chemicals Code Act 1994.
1.10
The stated purpose of the Operational Efficiency bill was to make minor and technical amendments to the various statutes relating to agricultural and veterinary (agvet) chemical products, and to seek to clarify ambiguities and remove redundant provisions. The Operational Efficiency bill lapsed in April 2019.
Acknowledgement
1.11
The committee would like to thank all the organisations and individuals who provided written submissions to the committee's inquiry. Your efforts have greatly assisted the committee in its deliberations.
Structure of the report
1.12
The report consists of three chapters. Chapter 1 provides an overview of the bill and information on the regulatory context. The chapter also provides a summary of the two inquiries recently undertaken in relation to the APVMA – the Streamlining Regulation Bill 2018 and the Independence of regulatory decisions made by the APVMA.
1.13
Chapter 2 outlines the key provisions of the bill, and Chapter 3 considers the issues raised by stakeholders in relation to the bill, and sets out the committee's conclusions and recommendation.
Purpose of the bill
1.14
The bill will amend the Agricultural and Veterinary Chemicals (Administration) Act 1992 (the Administration Act), the Agricultural and Veterinary Chemicals Code Act 1994 (the Code Act) and the Agricultural and Veterinary Chemical Products (Collection of Levy) Act 1994 (the Levy Act). The Bill will also repeal the Agricultural and Veterinary Chemicals Legislation Amendment (Removing
Re-approval and Re-registration Act 2014 (the Removing Re-approval and
Re-registration Act).
1.15
The stated purpose of the bill is to improve the effectiveness and efficiency of the national system for regulating agvet chemical products. It is proposed that the bill will:
provide the APVMA and industry with more flexibility to deal with certain types of new information provided when the APVMA is considering an application;
enable the use of new, simpler regulatory processes for chemicals of low regulatory concern, to simplify the approval of active constituents and labels, and the registration of certain products;
provide for extensions to limitation periods and protection periods as an incentive for chemical companies to register certain new uses of chemical products – particularly those uses (minor uses) with insufficient commercial return for chemical companies to normally add to the product label;
reduce the regulatory burden on industry by simplifying reporting requirements for annual returns;
support computerised decision-making by the APVMA;
reduce the administrative burden on the APVMA and industry by increasing the flexibility of the APVMA to manage errors in an application at the preliminary assessment stage;
reduce the regulatory burden by enabling the APVMA to grant part of a variation application under section 27 of the Schedule to the Code Act;
enable a person to apply to vary an approval or registration that is suspended, to the extent that the variation relates to the grounds for suspension;
establish civil pecuniary penalties for contraventions of provisions in the Agvet Code and the Administration Act relating to providing false or misleading information to the APVMA;
provide the APVMA with more comprehensive grounds for suspending or cancelling approvals or registrations where information is provided in a variation application that is false or misleading;
optimise risk communication about chemical products by improving the transparency of voluntary recalls;
harmonise the need to inform the APVMA of new information (where it relates to the safety criteria) so that the same obligations apply to all holders and applicants;
simplify the APVMA's corporate reporting requirements;
provide a more practical mechanism for dealing with minor variations in the constituents in a product, that normally occur in the manufacturing process;
clarify what information must be included on a label;
fix anomalies in the regulation-making powers for the labelling criteria;
amend the notification requirements in section 8E of the Agvet Code so that the APVMA and Food Standards Australia New Zealand (FSANZ) will have the flexibility to agree on appropriate timeframes for notifications and amend section 7A of the Administration Act to clarify the authority to make an APVMA legislative instrument for residues of chemical products in protected commodities;
amend the definition of expiry date in the Agvet Code to mean the date after which a chemical product 'must not' be used; and
make minor and machinery changes including removal of unnecessary and redundant provisions and other changes to realise operational efficiencies, reduce unnecessary regulation and clarify ambiguities.
Governance Board
1.16
The bill proposes the establishment of a Governance Board (Board) for the APVMA. It is submitted that the establishment of an APVMA Board would strengthen the organisation's governance arrangements and provide the necessary oversight to help the regulator manage operational, financial and performance matters.
1.17
It is proposed that the Board replace the Chief Executive Officer (CEO) as the accountable authority under the Public Governance, Performance and Accountability Act 2013 (PGPA Act). The Board will also set the APVMA's strategic direction, drive its operational performance, set an appropriate risk management framework and ensure greater accountability.
National Registration Scheme
1.18
Agvet chemicals are currently regulated through a cooperative National Registration Scheme (NRS). The NRS is a partnership between the Commonwealth, states and territories which have an agreed division of responsibilities. Assessment and registration of agvet chemicals and the control of supply activities (for example, retail sale) is undertaken by the APVMA. Regulating the control of agvet chemical use after supply is the responsibility of individual states and territories.
1.19
The NRS is implemented, in part, through the Code Act. The Code Act contains, as a schedule, the Agricultural and Veterinary Chemicals Code (the Agvet Code). The Agvet Code operates in each state, the Northern Territory and each participating territory (including the Australian Capital Territory and Norfolk Island) to constitute a single national Agvet Code which applies throughout Australia.
1.20
The Administration Act, the Levy Act, and the Code Act (including the Agvet Code and any regulations or legislative instruments made under these laws) are collectively described as agvet legislation.
Consultation
1.21
As noted above, the current bill contains measures contained in bills that lapsed in April 2019 – the Operational Efficiency bill and the Streamlining Regulation bill. An exposure draft of the Operational Efficiency bill was released for public consultation in June 2017, and an exposure draft of the Streamlining Regulation bill was released for public consultation in July 2018. Consultation in relation to both of these lapsed bills was also undertaken with relevant state, territory and Commonwealth authorities, and both were amended following consultation.
1.22
It is noted that the measures included in a Government amendment to the Operational Efficiency bill were developed following consultation with agvet chemical industry stakeholders which took place between November 2017 and July 2018.