EXPLANATORY STATEMENT
Issued by Authority of the Minister for Agriculture, Fisheries and Forestry.
Quarantine Act 1908
Quarantine Service Fees Amendment Determination 2013 (No. 1)
Legislative Authority
Section 86E of the Quarantine Act 1908 (the Act) provides that the Minister may make determinations that require specified fees to be paid for or in relation to the doing of anything in connection with, among other things, the management and maintenance of animals at a quarantine station in Australia, or specified examinations, services or other quarantine measures carried out or provided under the Act.
The Quarantine Service Fees Determination 2005 (Determination) sets out the fees that must be paid in relation to the management and maintenance of animals at a quarantine station, or for specified services carried out or provided under the Act. The Determination also provides that a quarantine station is a place that is appointed by the Quarantine Proclamation 1998 (Proclamation).
Item 36 of Schedule 1 to the Determination sets basic fees for holding specified animals in quarantine at a quarantine station and performing services in relation to those animals. These fees include the basic fee for an equine animal to be charged for each day the animal is housed in a quarantine station.
Purpose
The purpose of the Quarantine Service Fees Amendment Determination 2013 (No. 1) (Amendment Determination) is to amend the Determination, by increasing the basic fee for holding an equine animal in quarantine at a quarantine station and performing services in relation to that animal from $196 to $262 per day. This fee does not cover care and maintenance, or the provision of feed or veterinary supplies.
This amendment will enable the Department of Agriculture, Fisheries and Forestry (the department) to maintain the financial sustainability of its regulatory responsibilities in relation to the post entry quarantine requirements for horses. The amendment will support the continued and timely provision of services and other regulatory functions that serve to ensure the effective management of potential quarantine risks associated with live horse imports into Australia.
Background
In July 2008, the department established a separate budget for post entry quarantine regulatory activities for the importation of horses. This approach was established in response to recommendation 37 of the Report of the Equine Influenza Inquiry, which required that importation and quarantine fees be isolated, reviewed and set so that they fully cover the cost of the horse import services. The department’s primary function in relation to the importation of horses is to manage potential quarantine risks associated with the importation of live horses into Australia prior to their release into the domestic population.
Expenses relating to the post entry quarantine regulation of imported horses are funded through fees collected from users of the department’s post entry quarantine services for horses under a cost recovery arrangement. The single fee for a horse housed in one of the department’s post entry quarantine stations incorporates costs associated with detention, maintenance and movement of animals under quarantine, including all administrative processes. The fee also reflects that, in general, each imported horse attracts a similar level of regulatory effort and cost to manage potential quarantine risks. The total amount charged for each horse is proportional to the total number of days the animal spent at the post entry quarantine station and reflects the total regulatory effort applied by the department over that period. The fee for the cost recovery arrangement was last amended in November 2009.
Expenses associated with the department’s post entry quarantine activities are reviewed annually to ensure they are relevant to the anticipated level of horse import demand and a fee review may be undertaken if necessary. The department’s recent review of cost recovery arrangements refined the annual operating costs against anticipated volumes of horses to be imported over the period from 1 February 2013 to 30 June 2015. The review also identified that there were $1.46 million of under-recoveries accumulated in the three years leading up to 30 June 2012, which need to be addressed in future cost recovery arrangements. The deficit was a result of lower than expected horse import activity levels and was also partially due to increased costs since the fee was last adjusted.
As a result of this review, the department has determined that increasing the daily basic fee for a horse housed in one of the department’s post entry quarantine stations from $196 to $262 per day, starting on 1 February 2013, would be sufficient to recover the operating costs over the period of 1 February 2013 to 30 June 2015 and would generate sufficient annual operating surplus to restore $1.35 million of the accumulated under-recoveries by 30 June 2015. The balance of the Industry Equalisation Reserve including any potential deficit will be incorporated into a future fee review.
Impact and Effect
The adjusted fee provided by the Amendment Determination will apply to services provided in relation to an imported horse held in quarantine at a quarantine station appointed by the Proclamation. Section 14 and Part 1 of Schedule 1 to the Proclamation specify the facilities that are appointed as quarantine stations, which include the department operated facility at Eastern Creek in New South Wales, Australia. The Eastern Creek facility is the only department operated post entry quarantine station that currently accommodates horses. The adjusted fee will only apply to horse import related activities provided through this facility. However, the adjusted fee would also apply to horses imported through other department operated facilities should operations recommence at these locations.
Consultation
Consultation on the amendment was undertaken with the principal horse industry consultative forum, the Horse Industry Consultative Committee (HICC) and HICC Finance Sub-Committee. The HICC was established in 2008 to provide a forum for the department and industry stakeholders to discuss matters relating to post entry quarantine policy and regulation, including cost recovery arrangements. Financial reports on cost recovery are regularly tabled at HICC Finance Sub-Committee meetings. The HICC and its Finance Sub-Committee consist of all fee paying users of the department’s post entry quarantine services in the eighteen months leading up to September 2012. The HICC acknowledged that the amendment would be necessary to recover the revenue shortfall and future operating costs.
HICC and HICC Finance Sub-Committee members include representatives from:
- three horse import agentsCrispin Bennett International Horse Transport Pty Ltd, International Racehorse Transport and New Zealand Bloodstock Pty Ltd
- Australian Horse Industry Council
- Australian Racing Board Limited
- Australian Veterinary Association
- Equestrian Australia
- Harness Racing Australia Inc
- Thoroughbred Breeders Australia
- Werribee International Horse Centre
The Office of Best Practice Regulation was consulted by the department and has determined the amendment to be of minor nature and that no further analysis was required in the form of a Regulation Impact Statement (OBPR Reference Number: 14407).
The Department of Finance and Deregulation was consulted by the department in the preparation of a Cost Recovery Impact Statement (CRIS). The approved CRIS will be made available to the public via publication on the department’s website.
The Determination is compatible with the human rights and freedoms recognised or declared under section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. A full statement of compatibility is set out in the Attachment.
Details of the Quarantine Service Fees Amendment Determination 2013 (No. 1)
Section 1 – Name of Determination
This section provides that the name of the Amendment Determination is the Quarantine Service Fees Amendment Determination 2013 (No. 1).
Section 2 - Commencement
This Section provides for the Determination to commence on 1 February 2013.
Section 3 – Amendments of Quarantine Service Fees Determination 2005
This Section provides for Schedule 1 to amend the Quarantine Service Fees Determination 2005.
Schedule 1 – Amendments of Quarantine Service Fees Determination 2005
Item 1 amends paragraph (b) of item 36 of Schedule 1, by substituting the basic fee applicable to an equine animal at $196 per day with $262 per day. This basic fee is for holding an equine animal in quarantine at a quarantine station and performing services in relation to that animal, but does not cover care and maintenance, or the provision of feed or veterinary supplies. This represents an increase of $66 per day.
The purpose of the amendment is to reflect an appropriate fee to allow the department to recover costs associated with the delivery of the Post Entry Animal Quarantine – Horse program’s regulatory responsibilities for the import of horses.
Item 2 provides the transitional arrangement for the amendment. It provides for the adjusted fee to apply to an animal that starts to be held in quarantine on or after 1 February 2013.
The purpose of the amendment is to ensure that the new fee structure would apply to consignments that arrive on or after 1 February 2013, and that animals already being held in quarantine on 1 February 2013 will continue to be charged under the previous fee structure until their release.
ATTACHMENT
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Quarantine Service Fees Amendment Determination 2013 (No. 1)
This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Legislative Instrument
The Quarantine Service Fees Amendment Determination 2013 (No. 1) amends the Quarantine Service Fees Determination 2005 by increasing the basic fee for holding an equine animal in quarantine at a quarantine station and performing services in relation to that animal from $196 to $262 per day. This fee does not cover care and maintenance, or the provisions of feed or veterinary supplies for the animal.
Human rights implications
This Legislative Instrument does not engage any of the applicable rights or freedoms.
Conclusion
This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.
Senator the Hon. Joseph William Ludwig,
Minister for Agriculture, Fisheries and Forestry