Red tape holding back local food industry from paddock to plate
Monday, September 29, 2014/
Complex and duplicated regulations are holding the Australian food sector back, according to a report released by the Australian Food and Grocery Council today.
The Paddock to Plate report calls on the federal government to take notice of the burden excessive regulation, outdated transport rules and inflexible workplace awards is placing on the $311.4 billion food industry.
Without action, the AFGC says further jobs will be lost in the sector, which employs 1.64 million Australians, and local producers and suppliers will fail to take their share of growing global demand for food, which is anticipated to almost double by 2050.
In what the AFGC says is “the first attempt to take a whole of supply chain view across the food sector”, the report calls for a Productivity Commission inquiry into duplicated federal and state regulations in areas including food health and safety, waste management, land use, road access and trading hours.
The report estimates compliance with farming regulations accounts for 4.5% of companies’ total expenses and around 20 working days a year are spent dealing with administration.
In Queensland alone, agriculture businesses are governed by more than 55 pieces of legislation and regulations that amount to more than 9000 pieces of paper. In Tasmania, compliance with regulations is estimated to be costing farms 14% of their net profits.
The AFGC also wants restrictions on trading hours to be abolished, especially on public holidays, as well as greater flexibility in award provisions covering night, weekend and holiday work and improvements in the way overseas labour is used to fill seasonal employment gaps.
“Generally speaking, labour laws in Australia are based on the assumption that the labour needs of the agricultural, processing, transportation and retail sector can be achieved through the standard 9 to 5 work schedules,” said the report.
“[But] the reality is that the agricultural production and food processing sectors’ labour needs spike significantly during short but intensive harvest times; the transportation sector’s work is regularly conducted during night hours; and the retail sector services customers primarily during weeknights, weekends and peak seasonal times.”
“As a result, the real wages that are paid in these industries are significantly higher than other industries when overtime and penalty rates are considered.”
Reform is also needed to rules governing the transport industry, according to the report, which recommends the Road Safety Remuneration Scheme be abolished as it duplicates areas already covered by workplace health and safety laws and modern awards, and state governments work more closely to regulate the use of heavy vehicles.
The report came out of a retailer and supplier roundtable held by the AFGC in August and has been endorsed by the National Farmers’ Federation, the Australian Logistics Council and the Australian National Retail Association.
An AFGC spokesperson told SmartCompany SMEs make up over 50% of the association’s membership and these members have had opportunities to provide feedback on the report through the council’s small business forums.
“Ineffectual regulations impact companies of all sizes across the supply chain,” the spokesperson says.
Peter Strong, executive director of the Council of Small Business, told SmartCompany COSBOA backs the report 100%.
“The food industry is absolutely being held back by the domination of a few,” says Strong.
“It’s about productivity and standards of living.”
Strong says differences between state laws are a cause of concern for medium-sized food businesses, which often supply larger businesses in different locations.
“If their lives are harder, it makes the suppliers’ lives harder,” he says.
“Small businesses are the collateral damage … it affects truck drivers, those in the transport industry. And often it is the perception of regulations. They are afraid of breaking the law.”
“The message is make it simple so we can understand it and deal with it,” says Strong.
“You can still achieve safety, we all want to achieve that, but it’s the industry that knows how to achieve it.”