Chapter 1
Introduction
1.1
On 15 June 2010, the Senate referred the following matter to the Rural
and Regional Affairs and Transport (RRAT) References Committee for inquiry and
report by 30 August 2010:
(a)
the implications to the Australian horse industry of committing to an
Emergency Animal Disease Response Agreement (EADRA);
(b)
options for equitable contributions by horse owners to a levy scheme to
meet their obligations under EADRA in the event of an emergency animal disease
outbreak in horses;
(c)
criteria by which the cost burden of a levy would be shared between
Commonwealth, state and territory governments, horse industry groups and
owners;
(d)
quarantine and biosecurity threats to Australia's horse industry; and
(e)
any other matters.
1.2
Notice of the inquiry was posted on the committee's website. The
committee also advertised the inquiry in The Australian on Wednesday, 30
June 2010 and wrote to key stakeholder groups, organisations and individuals
involved in the Australian horse industry to invite submissions.
1.3
On 25 October 2010, following the commencement of the 43rd
Parliament, the Senate re-referred the inquiry to the Rural Affairs and
Transport (RAT) References Committee, for inquiry and report by 25 November
2010.
1.4
Following the re-referral of the inquiry, the committee again wrote to
key stakeholder groups, organisations and individuals inviting further comment
or submissions to the inquiry.
1.5
The committee received 24 submissions, including three supplementary
submissions, a list of which is at Appendix 1.
1.6
The committee held a public hearing in Canberra on 19 November 2010. A
list of witnesses who appeared at the hearing is at Appendix 2 and copies of
the Hansard transcript are available through the Internet at http://aph.gov.au/hansard.
1.7
The committee thanks all those who provided submissions and evidence to
the inquiry.
Background to the inquiry
1.8
In August 2007, Australia experienced an outbreak of equine influenza
(EI), an exotic disease not present in Australia. On 25 December 2007 – the
time of the last reported detection of the virus – horses on over 8,000
properties had been reported infected.[1]
1.9
In response to the emergency, Commonwealth, state and territory
governments worked with the horse industry and horse-owners to eradicate the
disease. On 30 June 2008, affected areas of the country were officially
declared free of the virus (with no new cases of the disease having been
reported since 25 December 2007). [2]
1.10
The report prepared by the Hon. Ian Callinan - Equine Influenza: the
August 2007 outbreak in Australia (the Callinan Report) – on the causes of
the EI outbreak noted that as at 28 February 2008, the Commonwealth Government
had provided – through various assistance packages – about $227.0 million of
the $268 million committed to individuals and businesses "whose primary source
of income had been affected by the outbreak and the subsequent movement
restrictions".[3]
Response to an emergency animal disease
1.11
In Australia, animal health emergencies are coordinated nationally, with
responses underpinned by the Emergency Animal Disease Response Agreement
(EADRA) which commenced in 2002. Under the EADRA, the costs of responding to
emergency animal diseases (EAD's)[4]
are shared by the affected parties, including the Commonwealth, all state and
territory governments and livestock industries.
1.12
The terms of the EADRA also include an agreement from the Commonwealth
to underwrite the costs of an emergency response to an EAD.[5]
In the event of an emergency, industry signatories to the EADRA must have in
place plans to meet their obligations under the agreement. In the majority of
cases this is in the form of a levy imposed at the point of transaction.
1.13
When the outbreak of EI occurred, the horse industry was not a signatory
to EADRA. The Commonwealth, therefore, met the cost of dealing with the EI
outbreak, and made the decision not to impose charges upon the industry
retrospectively.
Introduction of legislation to impose
a levy
1.14
In February 2008, the Government introduced several bills, with the
intention of imposing a levy on the initial registration of horses. The Government's
position was that the imposition of the levy would assist the industry to fund
its obligations under the provisions of the EADRA; and repay any amount paid by
the Commonwealth on behalf of the industry, in the event of an outbreak of a
horse disease.
1.15
The bills were passed by the House of Representatives on 3 September
2008, and were introduced in the Senate on 3 September 2008. On 4 September
2008, the Senate referred the provisions of the following bills to the Senate
Rural and Regional Affairs and Transport Committee for inquiry and report by 3
October 2008:
- Horse Disease Response Levy Bill 2008;
-
Horse Disease Response Levy Collection Bill 2008; and
- Horse Disease Levy (Consequential Amendments) Bill 2008.
1.16
In summary, the provisions of the bills were outlined as follows:[6]
Horse Disease Response Levy Bill
2008
1.17
This bill sought to provide the mechanism to impose a levy on the
registration of horses. The proposed levy arrangements for the horse industry
would be similar to those applying to other industries party to EADRA.
Horse Disease Response Levy
Collection Bill 2008
1.18
This bill sought to provide the framework for the collection of the
levy. Under s.55 of the Constitution, provisions dealing with the collection
and administration of a levy must be in legislation separate from the
legislation which imposes the levy itself. The bill also included provisions for
information gathering powers which would have allowed for the collection of
information and documents required by the Commonwealth.
Horse Disease Levy (Consequential
Amendments) Bill 2008
1.19
This bill sought to provide for the appropriation and application of the
levy. The legislation would have enabled Animal Health Australia to hold and
manage the levy on behalf of the horse industry. It would have amended the Australian
Animal Health Council (Live-stock Industries) Funding Act 1996. The bill
also sought provision of a mechanism for any excess levies collected – to allow
for their use in horse industry research and development, and for promotion of
horse health.
2008 bill inquiry
1.20
The Rural and Regional Affairs and Transport References Committee
received 33 submissions from representatives of the various sectors of the
Australian horse industry. Submissions were provided by representative horse
councils and associations, racing and thoroughbred organisations as well as
pony clubs, and individual horse owners.
1.21
Submissions to the 2008 bill inquiry are available through the Internet,
at https://www.aph.gov.au/Senate/committee/rrat_ctte/horse_disease/submissions/sublist.htm.
1.22
The majority of the submissions received, however, were provided by
representatives of the recreational and hobby sector of the horse industry,
with many making specific reference to the importance of drawing a distinction
between the 'recreational' and 'commercial' sectors of the horse industry.
1.23
Recreational horse owners pointed to the findings of the Callinan Report
which identified the cause of the EI outbreak as resulting from a breakdown in
quarantine arrangements and the importing of shuttle stallions. This section of
the industry used this finding to argue that the levy should be imposed on
those most likely to contribute to future disease outbreak and who would
ultimately benefit from any resulting compensation.[7]
1.24
However, representatives of the more 'commercial' sector of the
Australian horse industry, argued that disease outbreaks did not discriminate
between the recreational and commercial sectors and that pony club horses were
just as susceptible to disease as thoroughbreds.[8]
1.25
At the time of the 2008 inquiry, the committee heard evidence and
discussion in relation to a number of other issues, including:
- the need for a compulsory registration across the horse industry
and the most appropriate way to implement it;
-
the need for a national horse database;
- concerns that the imposition of a levy would result in horse
ownership becoming more onerous and more expensive, particularly for
recreational owners and riders;
- concerns that any financial burden would not be shared equitably;
and
- concerns that commercial operators and the racing sector could be
exempt from the levy.[9]
1.26
In addition to recommending the passage of the bills, the committee
indicated its support for compulsory registration for all horses and the establishment
of a national register. The committee also expressed confidence that the
regulations would be drafted in a way that would be equitable and not impose
"onerous conditions on recreational horse owners".[10]
1.27
The committee's report also noted that its review of the draft legislation
was concerned mainly with policy issues rather than technicalities:
... these bills essentially comprise enabling legislation,
and the detail of how the legislation will work will become more apparent once
the regulations to implement the legislation are made. Therefore, the committee
believes that its review of these bills may become a 'work in progress' as
current policy unfolds and the issues of registration and appropriate levies
across the broad equine sector are subjected to wider scrutiny.[11]
1.28
The committee also indicated that it would be monitoring the regulations
as part of its continuing scrutiny of quarantine and animal health issues.[12]
1.29
The legislation was ultimately reintroduced and defeated in the Senate
on 4 February 2009.
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