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Proposals to improve cost recovery in MPI's food system

Updates

1 July 2019 – Changes to fees and charges

Following consultation, there are new charges in MPI’s food system. Regulations for the changes were gazetted on 31 May 2019 and the changes take effect on 1 July 2019. See table below for a summary of the changes.

Cabinet papers are available

1 July 2019 - Cabinet paper seeking approval to change the regulations [PDF, 325 KB]

13 February 2019 

Proposals to improve cost recovery in MPI's food system:

1 July 2019 - Changes to fees and charges 

The table below summarises the changes to the fees.

Change

Previous Rate

New Rate

Rationale

Changes to cost recovery rates

Reduction in base hourly rates for 127 services provided by MPI, and replacing 51 of these charges with a fixed fee.

Charges based on $155 per hour

Charges based on $135 per hour

The base hourly rate reduction is necessary because costs are less than the $155 currently being charged. The replacement of variable charges with fixed fees will reduce uncertainty for fee payers about what their final charge will be.

Changing the rate for official assurances for animal material and non-live animals from $32 plus $155 per hour after the first fifteen minutes.

$32 plus $155 per hour after the first fifteen minutes

$33.75 plus $135 per hour after the first fifteen minutes

To align with the updates to base hourly rate of $135 per hour.

Updating trade name product registration charges under the Agricultural Compounds and Veterinary Medicines Act 1997.

$540 for pre-screening and

$540 for registration

$67.50 for pre-screening plus an assessment charge of $135 after the first 30 minutes for time spent

$405 for registering

To align charges with the updated base hourly rate, and make the charges more transparent by better reflecting where costs actually lie.

Replacing the current formula for determining the charge for infant formula export declarations with a specified charge rate.

Calculated by formula, currently $23

$33.75 per declaration plus $135 per hour after the first 15 minutes per declaration

To align this charge with official assurances and other charges using MPI’s updated base hourly rate and ensure consistency in charging for similar services.

Increasing the charge for official assurances for live animal or germplasm (currently) exports.

$32 plus $186.30 per hour after the first fifteen minutes

$46.58 plus $186.30 per hour after the first fifteen minutes

To align charges with MPI’s hourly rates for veterinarians.

Increasing the charge for Animal Welfare Export Certificates.

$21.33 plus $186.30 per hour after the first 15 minutes

$46.58 plus $186.30 per hour after the first fifteen minutes

To align charges with MPI’s hourly rates for veterinarians.

Increasing the hourly rate for circuit verifications from $165 to $176 per hour.

$165 per hour

$176 per hour

This change is necessary so that increased costs of providing this service can be met and past under-recovery of costs can be recovered.

Amending unit charge rates for export of live animals and some animal germplasm.

A mixture of increases and decreases for different categories of live animal and animal germplasm

An overall increase in the amount recovered is necessary so that increased costs of providing this service can be met and past under-recovery of costs can be recovered, while the allocation of costs between export categories is re-set to more equitably spread costs between export categories.

Amending provisions allowing cost recovery for approvals of official devices used in association with exports of animal products to also allow cost recovery for approvals to be a manufacturer or supplier of official devices.

Not currently recovered

$135 per application plus $135 per hour after the first 60 minutes

To allow recovery of costs which provide a service that directly benefits a service user, and to align with existing charges for approvals related to official devices.

Changes that aim to simplify, clarify and improve the transparency and equity of charges

Clarifying that the Agricultural Compounds and Veterinary Medicines levy (ACVM levy) is payable for each registered trade name product.

N/A

N/A

To more accurately reflect the services the levy funds and improve transparency of charges.

Clarifying that the animal product levy on coolstores and other storage premises includes standalone premises that store dairy products.

N/A

N/A

To ensure that all businesses subject to the relevant standards are treated equitably.

Expanding the application of the levy on processors of hides and skins to include all processors of animal material/products that are not for human or animal consumption and are exported.

N/A

N/A

To ensure that all businesses subject to the relevant standards are treated equitably.

Restructuring dairy levies:

 

 

To remove categories that no longer reflect differences in services provided, align them with updated base hourly rates, and better reflect current production and export volumes.

-       remove the medium processor category

$930

Either $400 (if classified as a small processor) or amount calculated through a formula (if large)

As Above

-       amending the definition of small processors to include those collecting less than 151,000 kilograms of milk solids annually (currently 16,500 kilograms)

N/A

N/A

As Above

-       reducing the small processor levy

$465

$400

As Above

-       amending the definition of small exporters to be exporters of less than 466,000 kilograms of dairy mass annually (currently 636,000 kilograms)

N/A

N/A

As Above

-       reducing the small exporter levy.

$310

$200

As Above

 

Changes to simplify and improve the administration and operation of cost recovery

Simplifying the process for amending the rates of the ACVM levy and wine export levy by allowing updates to be made by the Director-General in line with a formula without changing regulations, provided those changes are consulted on and rates remain below specified thresholds.

N/A

N/A

To significantly reduce the cost and time it takes to change levy rates.

Extending the power MPI and territorial authorities have to waive, exempt, or refund charges under the Food (Fees and Charges) Regulations 2015 beyond their current expiry on 30 June 2019.

N/A

N/A

This is necessary to ensure that there is an ability not to charge where it would be inappropriate to.

Introducing a charge for providing services related to market access to the non-dairy animal product cost recovery regulations.

N/A

$135 per hour

To align charging for non-dairy animal product cost recovery with dairy animal product cost recovery, and to increase transparency.

Requiring processors of fish and shellfish to report actual rather than estimated tonnage processed in the previous month or year.

N/A

N/A

To improve the accuracy of charges and reduce administration costs.

Requiring processors of animals that are not lambs, bobby calves, goats, sheep, pigs, cattle, horses, and deer to also report on the actual volumes of these animals processed in the previous month or year.

N/A

N/A

To improve the accuracy of charges and reduce administration costs.

Requiring processors of birds that are not ostriches, emus, and poultry to also report on actual volumes of these birds processed in the previous month or year.

N/A

N/A

To improve the accuracy of charges and reduce administration costs.

Consultation background

Consultation on 11 proposals to improve cost recovery arrangements in the food system opened on 15 November 2018.

  • Seven of the proposals were fee updates to ensure the amount we recover continues to reflect the costs of providing the services.
  • Three proposals were to simplify current cost recovery arrangements, improve transparency, and ensure equitable distribution of costs.
  • The remaining proposal was for several minor and technical changes to current cost recovery arrangements.

Consultation closed at 5pm on 20 December 2018.

What was proposed?

Check our summary of the 11 proposals with references to relevant pages in the consultation document.

Download the full document [PDF, 1.4 MB]

summary of 11 proposals

The diagram summarises the 11 proposals set out in the consultation document with the relevant page numbers from the document.

Major proposals

Decrease the base hourly rate for 127 fees in Animal Products, Animal Welfare, Food, Wine and ACVM Acts

Decrease current rate of $155 per hour to $135 per hour.  See pages 13 to 17.

Increase the circuit verification hourly rate

Increase current rate of $165 per hour to $176 per hour. See pages 43 to 48.

Other proposals

Trade name product

Reduce fees to:

  • $67.50 plus $135/hr after the first half hour for pre-screening (currently $540 flat fee)
  • $405 for registrations (currently $540).

See pages 18 to 24.

Dairy processor levies and dairy exporter levies

Reduce annual levies to:

  • $400 for small dairy processors (currently $465)
  • $200 for small exporters (currently $310).

Remove the medium dairy processor category.
See pages 54 to 58.

Official Assurance for animal products/materials and non-live animals

Align the fee rate to $135 per hour by:

  • increasing the first quarter hour fee to $33.75 (an increase of $1.75)
  • reducing the hourly rate after the first quarter hour by $20 per hour.

See pages 28 to 32.

Animal Products Act and Animal Welfare Act

Align fixed fees with correct hourly rate ($186.30 per hour).
Increase fees to:

  • $46.58 per live animals/germplasm official assurances (currently $32)
  • $46.58 per animal welfare export certificate (currently $21.33).

See pages 33 to 37.

Animal Products Act

Update 20 live animal and germplasm export charges (increases and decreases).
See pages 38 to 42.

Animal Products Act

Clarify that official device approvals cover applications to be an approved manufacturer or supplier (aligned to fee rate of $135 per hour). See pages 25 to 27.

ACVM Act and Wine Act

Simplify the process for amending levies (no financial implications). See pages 49 to 51.

ACVM Act

Clarify the levy provisions (no financial implications). See pages 52 to 53.

Animal Products Act

Minor technical amendments for standalone dairy storage and export approved premises, MPI’s market access services, infant formula export declarations and levies. See pages 59 to 62.


Consultation document

Consultations closed on 20 December 2018

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