Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

To assist the committee, I am going to try and ask these questions in subsections. The first set of questions I want to ask Senator Xenophon or Senator Siewert goes to the question of enforcement. Could you explain to the committee how you envisage enforcement occurring under the act, if it comes into effect with the proposed amendments. That goes to the question: is this the way to achieve the outcome that we are all looking for? If you could explain how the enforcement regime would work, that would be helpful.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

The bill in its amended form proposes that there be amendments to the Australian Consumer Law, which would mean enforcement via the ACCC. Before you get to the stage of enforcement, you need to look at the whole issue of appropriate labelling. There is still a role for FSANZ to play in developing labelling standards. The enforcement would be through the ACCC, but, before that, you have a process whereby FSANZ would play a useful role in developing and approving labelling standards. Let's put this in perspective. The position is that we are not seeking a boycott of palm oil, as Senator Siewert rightfully pointed out; this is just giving consumers the basic information, because to call it a vegetable oil is inherently misleading. The Blewett review picked up on that in recommendation 12. So, effectively, the mechanism of enforcement would be through the ACCC, through the ordinary course of enforcement mechanisms con­tained in the Australian Consumer Law.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

In that respect, what role do the state and territory food enforcement processes have? Are they completely unengaged in that process? I am just trying to ascertain the normal enforcement processes around food as compliance with the Food Standards Code is delivered by state and territory agencies. Is palm oil going to be completely separate and the ACCC would have a compliance role for palm oil alone?

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

The ACCC would have a compliance role in relation to this particular bill. If state agencies want to point out that there has been a breach of labelling laws in relation to this, they can have the same engagement as is currently the case with any food-labelling requirement. As I see the legislation set out in its amended form, following consultation with the coalition, it would be done through the ACCC. But the local food agencies, the local state regulatory agencies, can say, 'Here is a breach of labelling laws.' The outcome is the same in terms of enforcement. The pathway by which the label has been affixed, if you like, is through Australian Consumer Law. So, in a sense, it enhances the enforcement mechanism. In practical terms it could be dealt with by local agencies that point out a breach of Australian Consumer Law. My understanding is that parties are not prohibited from bringing an action, but the fact is that the ACCC would have a role. If this is about consumers not being misled, I think that is entirely appropriate.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

I just want to confirm that any Australian citizen, any entity, could make a claim of inappropriate labelling and then the ACCC would have to respond to that. Would anyone be able to make that request of the ACCC?

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I will not get started on the ACCC, so I will stick to the very pertinent question asked by Senator McLucas. As is the case now, any citizen can make a complaint to the ACCC about any breaches of Australian Consumer Law. It is expected that the ACCC will respond accordingly. The reality is that, if an individual citizen or business wants to pursue an action through Australian Consumer Law, that could be a very costly action. That is why you see very few private actions in relation to that. The primary purpose is for the ACCC to deal with these matters.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

Thank you for that. I now want to go to the question of who an action can be taken against. Is it a manufacturer; is it a distributor? Who would be able to be enjoined in an action under the proposed amended legislation? It is not clear to us that it is simply the manufacturer. Is it my corner shop?

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I thank Senator McLucas for the question. The legislation makes it clear that there is an obligation on goods manufactured after 12 months of the commencement of that section. The issue relates to the manufacturer and the label. My interpret­ation of it is that it is confined to the manufacturer—that it is not intended to deal with the corner shop and penalise them. It is the manufacturer that manufactures these goods. Of course, if a corner shop has its own home brand or whatever, then there is a nexus between the two by virtue of the act of manufacture, but it is intended, by the plain wording of this bill, that the manufacturer has the primary role. In terms of the way Australian Consumer Law works, if they are overseas manufactured goods and their distributers are in Australia, then you have a clear mechanism, a clear pathway, to ensure that the law is effectively enforced.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

I may come back to that issue because I think this is something that we do need very clear clarification about. I will go to the question then of manufactured goods. What does it cover? It seems clear in one part that we are talking about food and then in another part of the material that I have seen it seems to be able to include anything that has palm oil in it, which would then go to soaps, detergents, cosmetics, biodiesel et cetera. I just need to be very clear what we are talking about in terms of the labelling provisions.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

The answer is anything that contains palm oil regardless of how much.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

So it is not just food then, absolutely?

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

That is correct.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

In respect of the CS palm oil provision which Senator Siewert talked about, I am interested to know how the traceability of that would work. How would the ACCC be able to confirm one way or another that this particular palm oil is the sustainable type as opposed to the non-sustainable type? I just want to consider the traceability—the tracking back.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

Another excellent question from Senator McLucas. That is why Senator Siewert foreshadowed, following discussions with the coalition, that it would be taken out. Those clauses relating to certified sustainability would be taken out because of the very issues of traceability that Senator McLucas raises.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

So in effect we are not differentiating between them. I know that there is a question about what sustainable palm oil might be, but if in fact it is sustainable we would not differentiate and therefore any claim that was made by a sustainable palm oil manufacturer about its sustainability could be illegal to place on a label under this legislation—is that the case?

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

The position is this: if a manu­facturer seeks to assert that they have certified sustainable palm oil, they can do so voluntarily. The efficacy and accuracy of that statement is something that would be subject to general Consumer Law provisions in terms of false and misleading statements. But I understand and appreciate the point made by both the opposition and, indeed, by the government about the traceability issues and the robustness of that. Therefore it is left to general provisions of Consumer Law as to false and misleading conduct if somebody raises the issue that they have got certified sustainable palm oil. The robustness of such claims is something that can be caught under general Consumer Law, but it is a matter that will be voluntary rather than having a statu­tory standard, and for the very reasons that Senator McLucas raises it is problematic.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

That goes to the uncertainty that I think is being introduced by this. We should have far more clarity about how the enforcement will be delivered. I go back then to the Australian Consumer Law issues that I was talking about earlier. Section 33 of Australian Consumer Law indicates that anyone engaged in trade or commerce is captured. Wouldn't that include retailers? This is the difficulty that we have in trying to get some legal advice in 12 hours. Let us be clear. Section 33 states that anyone engaged in trade or commerce may be captured, and the question therefore is: wouldn't that include retailers and distributors, along with the manufacturers? Can you point me to where they are excluded?

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

Again, a very important question. I think these are very important preliminary questions raised by Senator McLucas, but by virtue of the drafting of the amendment the focus is on the manufacturer. The focus is on an obligation on the manufacturer and that narrows the scope of the enforcement of this to the manufacturer. But also under general definitions you look at the issue of the distributor. If you are bringing in goods, you are deemed to have the same liabilities that apply to a manufacturer whether it is for foods or for manufactured goods and the like. So that is the reading of that. I am happy to explore that further, but that is the clear aim and content of the proposed amendment that deals with having a focus on manufacturers as a result of the discussions that I had with the coalition in relation to this.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

I would like to move to the position of the opposition. Would the opposition discuss the consultations that they have undertaken in the time that we have had to discuss the bill. I know that is an unusual question to ask, but I think that it is important for the record that we have the opportunity to talk about the consultation process that the opposition has undertaken. I invite the opposition to provide the chamber with a discussion about the consultation that has been undertaken.

Scott Ryan (Victoria, Liberal Party, Shadow Parliamentary Secretary for Small Business and Fair Competition) Share this | Link to this | Hansard source

Thank you, Senator McLucas. I did not know questions came from that direction across the chamber, but I will do my best to answer them better than they have been when they have gone the other way of recent times. Firstly, I want to make a point—I said this earlier—about Senator Moore's speech, and I want to make a point about the comments you have made, Senator McLucas. With all due respect, the endless, interminable process that has now been around this issue for so long—you have demonstrated quite well, because you are quite right, that it is complex—is actually one of the reasons the coalition has decided to support this piece of legislation, because ideas drop into the bureaucratic morass that is intergovernmental arrangements in this country. Too often—not all the time, but too often—they do not come out.

I do not plan to give a complete list of every person I have spoken to about this legislation, nor to go through my diary over the last week and outline all the consultations. I have indicated the coalition is supporting the bill.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

He spoke to me.

Scott Ryan (Victoria, Liberal Party, Shadow Parliamentary Secretary for Small Business and Fair Competition) Share this | Link to this | Hansard source

I have spent a lot of time with Senator Xenophon. I have spent a lot of time with colleagues in the lower house. I have spoken to the industry sector. I have spoken to NGOs and think tanks about this legislation. I do not plan to go through names for you, Senator McLucas. I would not expect you to do so. I am not proposing the legislation; I am outlining the coalition's position. I do not think I have been shy about the reasons for that, and I do not plan to take up much more time of this Senate repeating what I have said earlier.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

In response to that, I note that the opposition was in government for 12 years. I spent a lot of time sitting on the other side of the chamber. When we came into government I became the Parliamentary Secretary to the Minister for Health and Ageing. I had responsibility for food and labelling, and I remember many conversations I had with Senator Siewert over that time about the problems that we have with labelling in this country, and it was I who established the review. So you had 12 years to do something about labelling of food, and you did nothing. All of a sudden now we have this big change of heart that means that we are going to have a special labelling regime for palm oil, but all of those other issues that people have talked to us about—need for clarity in labelling, ingredient lists and all of those issues—we are not going to deal with today, according to the opposition. We are going to deal with palm oil, which is an important thing to do, but you had 12 years on the government benches to do something about labelling, and it was only when Labor came into power that we started the process of getting a better labelling system in this country.

I accept Senator Siewert's concern about time. If it had happened about 10 years ago, it might have been fixed by now.

Rachel Siewert (WA, Australian Greens) Share this | Link to this | Hansard source

They've seen the light now, though.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

It is a funny light: it is a light that shines on just one ingredient—it is an important ingredient that affects the orangutan population, but it is one ingredient in all of the food and other products in our country. So we are shining a light on palm oil, and that is important and good, but we had the opportunity and we have the opportunity to be comprehensive about our labelling regime in this country, and responding to the Blewett review is the way in which our government has shown the way forward. You had 12 years to do something, and you did nothing, and now we are, it would seem, going to deal with it ingredient by ingredient. Bit by bit we are going to change the food-labelling laws if this is the precedent we are setting today.

My final question before we go into the full committee stage is to Senator Xenophon or Senator Siewert: how will this affect the review of labelling process that we are going through?

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I see it as enhancing the process. I see it as sending a clear message to government and to bureaucracy. I want to make this very clear: I have great respect for Senator McLucas and the work she has done on this, but Senator McLucas should understand my frustration, the frustration of Senators Siewert and Bob Brown and the frustration of members in the coalition who have been campaigning on this as well for a number of years. We need to get on with it. I must say that Neal Blewett is a great Australian, and I have enormous regard for him, but I was disappointed with many parts of the review. I felt that it could have gone further, but the government is working through that; I understand. But how much longer does it have to work through on things? The Commonwealth clearly has a leadership role here, and I acknowledge the leadership role that Senator McLucas has had on this, but I do not see this as in any way impeding the process of further food labelling; in fact I see it as enhancing it.

I think we also need to stand up to the Australian Food and Grocery Council. Just last night on Lateline we heard a number of leading public health experts, including the government's Preventative Health Taskforce chair, Professor Rob Moodie, being quite scathing of the Australian Food and Grocery Council and its influence in public debate on a whole range of measures in terms of dietary issues. I think Senator McLucas is aware of those particular concerns—that the Food and Grocery Council has too much government influence and is delaying effective action against diet related diseases. I see this bill as enhancing the process.

I think Senator McLucas knows how I work with the government and how I worked with Minister O'Connor and other parts of the government, including the Prime Minister's office on the flood levy. I am happy to work cooperatively with people, but if you treated good ideas dismissively then I felt the only thing I could do was to enter into substantial negotiations with the coalition, and they have borne fruit. So I see this as enhancing the process. I see it as speeding up good food-labelling laws, which I think that Senator McLucas will welcome given her long-term advocacy on this.

Scott Ryan (Victoria, Liberal Party, Shadow Parliamentary Secretary for Small Business and Fair Competition) Share this | Link to this | Hansard source

I will be exceedingly brief and just say, in response to Senator McLucas's comments about the coalition position, firstly, that I was not here, so I will be accountable and at least outline my own position. I also simply say that action on one front does not preclude action on many, and the logic that this somehow would delay action upon the broader front of labelling just does not make any sense. This is taking action on one particular issue which is of concern and using an effective regu­latory framework we have in place.

Mark Bishop (WA, Australian Labor Party) Share this | Link to this | Hansard source

With that preliminary discussion, perhaps I could get some advice to the chair from the sponsors of the amendments. Do you wish to deal with the amendments seriatim or to deal with amendments (1) to (4) as a block, Senator Xenophon or Senator Siewert?

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I am in the hands of the chamber. I am happy to—

Scott Ryan (Victoria, Liberal Party, Shadow Parliamentary Secretary for Small Business and Fair Competition) Share this | Link to this | Hansard source

As a block.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

As a block? Very well, if that is going to save time. I seek leave to move all the amendments standing in my name and the name of my colleague Senator Siewert together.

Leave granted.

I will very briefly set out the reasoning for each amendment, if that is the will of the chamber. Firstly, amendment (1) relates to the commencement date. The amendment acknowledges that and so provides that the mandatory labelling of palm oil will apply only to goods sold at least 12 months after this act is given royal assent. I should point out that there is a similar application provision in amendment (3), which provides that the mandatory labelling of palm oil will only apply to goods manufactured 12 months after this bill is given royal assent—again, acknowledging the long shelf life of certain products. I will speak to that in shortly.

Amendment (2), relating to purpose, follows discussion with the coalition and my colleagues in the Greens. It is in line with the amendment to remove the provision in the bill relating to certified sustainable palm oil labelling. It also amends the purpose of the act to take into account that this labelling, under the Australian consumer law, is applied to goods. Currently the bill refers to food but, of course, palm oil is present in around 50 per cent of goods on supermarket shelves—not just foods but also cosmetics and other household goods.

Amendment (3) removes the certified sustainable palm oil provision—and we have already discussed that.

Amendment (4) relates to the Australian consumer law and follows my discussions with the coalition and, in particular, the shadow minister for consumer law and member for Dunkley, Mr Billson. Section 33 of the Australian consumer law says that a person must not, in trade or commerce, engage in conduct that is likely to mislead the public as to the nature, manufacturing process, characteristics, suitability for purpose or quantity of any goods. Under the proposed amendment, one of those characteristics is palm oil. What this essentially means is that, where palm oil is a characteristic of a good, the manufacturer must not mislead the public by labelling it as simply vegetable oil.

There is also in the amendments an application to say that this requirement will apply to goods manufactured 12 months after the bill has been given royal assent. This will give manufacturers time to transition to the labelling requirement—again, acknowledg­ing that some products which contain palm oil have long shelf lives.

Before I finish, it would be remiss of me not to thank my adviser Evelyn Ek. She would probably kill me if I did not acknowledge the enormous amount of work she has done on this. I fear that she will threaten to say that, if this bill goes through, she has no further reason to work with me and can retire from working as a political adviser. I hope that is not the case—and I hope that she is not poached!

I move amendments (1) to (4) standing in my name and the name of Senator Siewert:

(1)   Clause 2, page 2 (at the end of the table), add:

(2)   Clause 4, page 2 (lines 15 to 20), omit the clause, substitute:

4 Purpose of Act

     The purpose of this Act is to ensure that consumers have clear, accurate information about the inclusion of palm oil in goods.

(3)   Schedule 1, item 1, page 3 (lines 8 to 23), omit subsections 16 A (1) and (2), substitute:

(1)   The Authority must, within 6 months after the commencement of this section, develop and approve labelling standards that prescribe that producers, manufacturers and distributors of food containing palm oil, regardless of the amount of palm oil used in the food or used to produce the food, must list palm oil as an ingredient of the food.

(4)   Page 4 (after line 14), at the end of the bill, add:

Schedule 2—Amendment of the Competition and Consumer Act 2010

1 Section 33 of Schedule 2

Before "A person", insert "(1)".

2 At the end of section 33 of Schedule 2 (before the note)

Add:

(2)   For the purposes of subsection (1), the characteristics of any goods include the use of palm oil in the goods or to produce the goods.

Application

(3)   Subsection (2) applies to goods manufactured after 12 months after the commencement of that subsection.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

I have a technical question. Senator Xenophon, can you just advise when sheet 7090 Revised 4 was tabled in the chamber?

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

It was tabled very recently. We just wanted to clarify the issue of 'goods' and 'food'.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

I understand that it was tabled while I was speaking. If this is not policy on the run then I have never seen anything quite like it. It makes it extremely difficult to make a considered contribution to this place. This was tabled while I was speaking. Here we are, taking a decision on something when it is extremely difficult for me to seek advice.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I take Senator McLucas's point. I want to make it very clear that there is nothing tricky or sneaky about this. It is simply to make it clear that it applies to goods, not just foods, by virtue of the application of the Australian Consumer Law. It is by way of clarification; it is not introducing a new concept. I take Senator McLucas's point, but it does not introduce a new concept to the bill; it simply clarifies an aspect of it so that, to be consistent with the amendments the Australian consumer law, it applies to goods.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary for Disabilities and Carers) Share this | Link to this | Hansard source

I beg to differ. I am tenuous about making this claim, but the way I look at Revised 3 is that it must list palm oil as an ingredient of the food but Revised 4 means it is any product that contains palm oil. That is a huge shift, and seeking advice about what that might cover is really difficult.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

It is effectively consequential to having Australian consumer law applying to this. Australian consumer law applies to goods, including food, so it is all-encom­passing. So the concept is no different; we are just clarifying it so that there would not be any confusion that one applies to food and the other applies to goods generally. It is consistent with the information that was provided last night about having amendments to the Australian consumer law, which applies more broadly to goods.

Question agreed to.

Bill, as amended, agreed to.

Bill reported with amendments; report adopted.