Jan Davis on the poppy industry review

Earlier this week, Attorney-General Brian Wightman released lawyer John Ramsay’s long-awaited review of regulation in the poppy industry and his recommendations for change at the Poppy Advisory and Control Board (PACB).

The report makes some important and pertinent observations about the current regulatory system, including:

The regulatory regime under which the industry operates is obscure, the “black letter law” limited, and “there are no available regulations, guidelines or codes of practice such as one might find in other regulatory systems”.

The international treaty under which the industry operates (the Single Convention on Narcotic Drugs 1961) does not require growers to be licensed because they are not growing poppies for opium, yet Tasmanian growers have to be licensed. This regulation needs to be reviewed in light of the changing industry landscape.

The lack of written policies and guidelines used by either the board or the relevant decision maker as delegate in the exercise of the minister’s discretion “does not provide transparency and independence in decision making”.

We have no problem with the general thrust of Mr Ramsay’s recommendations. However, you have to query why it is dated July 2013 but only released this week.

Because of that time delay, Mr Ramsay’s report does not address the now-real situation of poppies being grown in other states and potentially imported for processing in Tasmania. In light of this significant change in the industry, it will be important to ensure that Tasmanian poppy growers are not forced to bear the costs of unnecessary regulatory burdens. On that basis, it is surely appropriate that there is discussion about development of a national regulatory regime before there is any move to grant licences to grow poppies on the mainland.

The report states that “the present arrangements for managing the industry are outdated. They may have been appropriate for a fledgling industry, but are anachronistic for controlling an industry which has achieved such significance to the Tasmanian economy and such significance within the global licit opiate market”.

Most importantly, the report does not address the issue which was key in growers’ minds when making submissions – that is the government’s proposed change to require growers to fund the cost of industry regulation.

In the 2012 budget papers, the state government announced its intention to transfer the coast of running the PACB from taxpayers to the industry commencing 1 July that year. This function was to be funded via a levy collected through the processors based on the number of hectares of crop they process. The estimated cost of the regulatory regime is around $650,000 each year; and it isn’t hard to work out that the processors will simply past that added cost onto their growers.

The TFGA, among others, complained bitterly when that came like a bolt from the blue in that budget. We said then that the benefits of the poppy industry spread across the economy and equity would demand that the cost of regulation be spread across the economy. On that basis, as with most other regulations, the government should meet the cost.

At this stage, the government has not revisited this intention and it has done nothing to speak with industry about the proposed levy; but nor has it ruled the proposal out. The Ramsay report is silent on this matter yet several of the recommendations in the report do not stand up if the government follows through on its levy proposal.

Mr Ramsay does say that the current regulatory system is an anachronism, is inappropriate, obscure, lacking in support codes and statutes and does not provide transparency and independence in decision making.

This is a damning indictment of a supervisory regime for an industry that is worth $150 million a year at the farm gate.

In its recommendations, the report says the PACB should:

review and re-establish effective and responsive administrative practices and procedures

review its current practices and procedures with a view to publishing appropriate guidelines or codes of practice to inform and assist the industry participants and the general public on how the industry is regulated.

In other words, after a lengthy and detailed review, the report’s author recommends that more reviews are needed.

It is clear there is an urgent need to revisit many of the assumptions and recommendations based on changes in the industry’s operating environment since the report’s completion.

We welcome the government’s commitment recognition of the important role the poppy industry plays in Tasmania’s economy. However, we urge them not to rush to implement the recommendations of the Ramsay report without further consultation with industry.
Jan Davis, TFGA: Tasmanian Country column today