THE Harper Review of Australia’s competition policy has fired a warning shot at the South Australian and Tasmanian governments restricting farmers’ access to genetically modified (GM) crops.
A draft document of the comprehensive national competition policy review was released late last month and is now open for public comment.
Review panel member and Regional Australia Institute CEO Su McCluskey said public consultation forums would start this week throughout Australia.
Ms McCluskey said the four-member panel would gather feedback on whether the draft report was correct in certain areas, or needed changing ahead of its finalisation.
Public submissions will be taken up until November 17 and then the committee will adjourn and write a final report to be handed to government, she said.
“This is an opportunity for anyone out there to give us feedback on the draft report,” she said.
On GM crops, Ms McCluskey said the draft report stated that regulatory restrictions should not be imposed that prevent competition - but at the same time health and safety factors need to be considered by individual States.
“Following the introduction of the National Competition Policy in 1995, there was a concerted effort to examine and reform regulation that restricted competition - where the restrictions were not in the public interest,” she said.
“These regulations were subject to review for their anti-competitive impact.
“However, a number of these regulatory restrictions remain in place, including restrictions that prevent GM crops from being grown in SA and Tasmania, whereas they can be grown in all other mainland States.
“While the general intention of the regulatory restriction may be to serve other public policy purposes, such as health or safety, there can be a restriction on competition.”
The GM landscape
SA and Tasmania have blocked the use of GM crops, but NSW, Victoria and Western Australia have opened the door to allow the production of GM canola in recent years, citing confidence in federal regulators.
The Gene Technology Regulator and Food Standards Australia New Zealand (FSANZ) assess the health and environmental risks of GM crops and foods, in response to public concerns and debate.
The Genetic Testing Registry (GTR) can only issue licences for GM crops once the agency is satisfied any risks can be managed to protect the health and safety of people and the environment.
FSANZ is an independent statutory authority responsible for food safety and regulation that has so far approved over 30 GM products from selected varieties of soybean, corn, canola and cotton.
“Australia’s requirements for GM food labelling, administered by FSANZ, are among the most comprehensive in the world,” the Department of Agriculture website says.
“In the future, gene technology may be used to help reduce allergy concerns with staple foods like wheat, soybeans and peanuts and environmental allergens such as grass pollens.”
Ms McCluskey said the review panel’s general rule was that these types of regulatory restrictions should not be in place but the final call is up to individual States.
She said the panel believed it important there be an independent, transparent and thorough process of assessment, and had therefore recommended governments should review regulations in their jurisdictions to ensure unnecessary restrictions on competition are removed.
Ethanol in the mix
Another example of regulatory restrictions on competition, cited in the draft report, was the concessional excise treatment of domestically produced ethanol while imported ethanol pays full excise.
The report also cited the sale of fresh potatoes being restricted in WA but nowhere else in Australia.
Ms McCluskey said the review also considered collective bargaining arrangements and the need to distribute more information into regional areas, so small businesses better understand their available options.
She said recommendations were also made on Section 46 of the Competition and Consumer Act regarding the misuse of market power.
Section 46 is relevant to farmers that may have less market power, in their individual supply chain, in relation to selling their goods to limited purchasers.
Ms McCluskey said when drafting the report, stakeholders suggested section 46 needed to be changed because complaints to the Australian Competition and Consumer Commission (ACCC) didn’t result in action.
But she said the complaints often didn’t involve illegal acts or the individual businesses didn’t have the time or money needed to take remedial action.
“We said we think access to remedies is a very important factor here and we’ve recommended the ACCC does more to help small businesses in relation to access to remedies,” she said.
“But we’ve also asked the question, when it comes to dispute resolutions, what else can be done to actually help small business?
“One of the things we’ve put out there is the ability for peak bodies or industry associations to take forward a case on behalf of businesses, so the business doesn’t get identified.
“And if we do that, is there a way we can help and put in a mechanism so it’s not costly for them?”
Ms McCluskey said section 46 needed to deal with the impact of market power abuse on competition and not the impacts on an individual competitor.
“The law isn’t there to protect individual competitors so we’ve recommended rewording on that,” she said.
Victorian barrister Michael O’Bryan and former Australian Chamber of Commerce and Industry chief executive Peter Anderson joined Ms McCluskey on the review panel that was chaired by Professor Ian Harper, an economist with Deloitte Access Economics.