1. Why aren’t we having a levy poll every 5 years with several options as we did previously?
In 2014, in response to feedback received after the 2012 levy poll, an independent panel (the Dairy Levy Poll Process Review) was appointed to consult with dairy levy payers and industry on improving the dairy levy poll process, particularly having regard to the significant cost of running a levy poll. In late 2015, levy payers were asked to vote in a poll on the key recommendations of the Dairy Levy Poll Process Review, undertaken earlier that year. Levy payers supported the removal of the compulsory requirement for Dairy Australia to convene a levy poll at least every five years. Instead, a Levy Poll Advisory Committee (LPAC) would be convened to determine if a change to the levy should be recommended and a levy poll held.
In early 2016, legislation passed the Federal Parliament to amend the Dairy Produce Act 1986 (Cth.) (the Act) to effect this change, and on 15 December 2016, the Minister for Agriculture and Water Resources, the Hon. Barnaby Joyce, signed the Dairy Produce (Dairy Service Levy Poll) Instrument 2016 (the Instrument). The Instrument replaces the Dairy Produce (Dairy Service Levy Poll) Regulations 2016 (the Regulations) and sets out the process for establishment of the Levy Poll Advisory Committee and the process that it must follow for review of the level of the dairy service levy.
The Instrument requires that Australian Dairy Farmers (ADF) (as industry representative body), and Dairy Australia (DA) (as industry services body), must jointly make a recommendation to the Levy Poll Advisory Committee in each levy review cycle about whether there should be a change in the levy rates, and if so, the nature of the change.
2. Who put the new regime in place?
The new regime was put in place through an amendment to the Act and the Instrument replacing the Regulations. These changes were implemented after a program of consultation with dairy levy payers and a vote that took place in 2015.
3. Were levy payers consulted, or was this dictated by the government?
As outlined above, the Dairy Levy Poll Process Review (the Review) was established in response to the feedback received from the dairy industry after the 2012 dairy levy poll that the process was cumbersome and inflexible and imposed a considerable time and resource investment on levy payers.
All dairy levy payers informed of the review and were invited to make submissions to the Review regarding possible changes to the levy poll process including the impacts to levy payers of any proposed changes.
The Review made certain recommendations, including that the compulsory requirement for Dairy Australia to convene a levy poll every five years be removed, and that a Levy Poll Advisory Committee be convened to consider (at least every five years) whether the levy should be changed.
The Review’s final report and its recommendations were made publicly available via a website.
ADF and State Dairy Farming Organisations held consultative meetings with levy payers and in late 2015 levy payers were asked to vote in a poll on the Review’s key recommendations. Levy payers supported the removal of the compulsory requirement for Dairy Australia to convene a levy poll at least every five years.
4. Who are the members of the Levy Poll Advisory Committee (LPAC)?
There are 15 members of the Levy Poll Advisory Committee (LPAC). Members are as follows:
- Mr John Lawrenson – Chair – appointed by Dairy Australia and Australian Dairy Farmers
- Mr David Basham – (the then President) Australian Dairy Farmers (now Mr Terry Richardson)
- Dr Dedee Woodside - Director, Australian Dairy Farmers
- Mr Ross Joblin - Company Secretary, Dairy Australia
- Mr Jeff Odgers - Director, Dairy Australia
- Mr Robert Poole - President, Australian Dairy Products Federation
Levy payer representative members:
- Di Bowles (Victoria - North)
- Noel Campbell (Victoria - East)
- Nick Cramp (Tasmania)
- Donna Edge (Victoria - West)
- Peter Evans (WA)
- Robert Miller (NSW)
- Michael Perich (NSW)
- Matthew Trace (Qld)
- Susan Wearden (Victoria - North)
5. Were levy payers invited to apply for the 9 levy payer representative positions on the Committee – when and how?
All dairy levy payers were sent a letter inviting them to apply for one of the nine levy payer representative positions on the Committee.
6. How many applied?
A total of 14 applications were received.
7. How were the members of the LPAC selected?
The independent Chair (John Lawrenson) was appointed jointly by Australian Dairy Farmers (ADF) and Dairy Australia (DA). The five initial members of the Levy Poll Advisory Committee were nominated by ADF, DA and the Australian Dairy Products Federation. The initial members (together with the Chair) formed a selection panel that proceeded to select up to nine milk producer levy payer representatives from applications received from levy payers to join the Committee in August 2016.
8. What is the role of the Levy Poll Advisory Committee?
The core role of the Levy Poll Advisory Committee is to make recommendations regarding the level of farmer levy funding to support the long-term research, development and extension strategy for the dairy industry.
The functions of the Levy Poll Advisory Committee are:
(1) To make decisions about the request of a levy poll (following the joint recommendation by ADF and DA);
(2) If a levy poll is to be held,
a. Provide input to Dairy Australia on the preparation of a plan for pre-poll consultation;
b. Endorse any proposed electronic voting facility; and
c. To examine and endorse the draft ballot paper, voting instructions and information memorandum.
9. What was the recommendation put to the Committee?
The joint ADF and Dairy Australia recommendation to the Levy Poll Advisory Committee was that there be no change to the Levy.
10. How often has the Committee met?
The Committee has had three meetings, two of which were face to face meetings.
11. What material has the Committee reviewed?
The Committee reviewed the joint ADF/DA submission to the Committee which outlined a number of options for changes in the levy and provided commentary regarding the advantages and disadvantages of each option.
The Committee requested further information:
- providing a representative sample of recent Benefit/Cost Ratio studies, to evaluate the returns received from levy payer investment;
- explaining the methodology used to assess those benefits; and
- providing detailed analysis of how Dairy Australia spends its available funds and the delivery of benefits from that spend.
12. What can farmers do if we do not agree with this decision?
Dairy Australia has fourteen days from receipt of the decision of the LPAC to advise all levy payers of the outcome.
Levy payers that are not happy with the decision of the LPAC, can initiate a petition in support of an alternative option.
To do this, levy payers who are Group A members of Dairy Australia and who together represent 15% of total levies paid in the previous financial year, have 75 days to lodge a petition with Dairy Australia, specifying their proposed levy option. This petition will activate an Extraordinary General Meeting at which Group A members of Dairy Australia will have the opportunity to vote to either proceed or not proceed with a levy poll.
If the resolution to hold a levy poll is passed, Dairy Australia must present the petition and the results of the vote to the LPAC within 14 business days after the resolution is passed. The LPAC must also request a levy poll as soon as reasonably practicable which must include the levy option(s) proposed by the petition and any levy option(s) proposed by the Committee.
13. What are the requirements of the petition?
- Levy payers who are Group A members of Dairy Australia can sign a petition.
- Those signatories must be Group A members that taken together, paid levies that, for the immediately preceding financial year, were not less than 15% of the total amount of dairy levies paid to the Commonwealth.
- The petition must propose a levy option other than a proposal for no change,
- A signatory to a petition will need to supply details of their Dairy Enterprise Number (DEN), herd production volumes/data, name of contact, phone number and email details. The requirement for provision of herd production volumes is to assist in ensuring that the 15% threshold has been met (which will need to be verified by Dairy Australia).
- If a Group A member wishes to verify that signatories to a petition are Group A members, they can request a copy of the Members Register from Dairy Australia. This is done by filling out an application form, which includes agreeing to the terms and conditions on which the information is supplied (in compliance with the Corporations Act).
- Dairy farmers can become Group A members by calling up Dairy Australia or filling out the online application form set out at http://www.dairyaustralia.com.au/Industry-information/About-Dairy-Australia/Who-we-are/Members.aspx
14. Who can I talk to about this?
Information on the Levy Poll Advisory Committee and the Levy Poll process can be found on this website.
If you prefer to communicate with someone directly, please contact Emma Braun, who performed the role of Secretariat for the LPAC on 03 9694 3719 or email@example.com
Overview of new Dairy Levy Poll Process