DAFF Meeting Minutes: Sweet Potato Levy.

FOR OFFICIAL USE ONLY
Australian Government
Department of Agriculture, Fisheries and Forestry
Date: 20 February 2013
Time: 9 am- 12 pm
Minute No: MNBR2013/01007
Peter Ottesen
Ph:
Agricultural Productivlty
Place: Boonah, Queensland (more precise location details will be provided in the Department of
Regional Australia's minute for this meeting).

Not requested
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The primary purpose of the meeting is to tour flood damaged areas around Boonal1. The Department
of Regional Australia is providing separate briefing on this matter.
This minute provides information about AUSVEG's objection to the sweet potato marketing levy
proposal, which Mr Brent may raise during your meeting.

That you:
1. Note the information provided
Noted I Please Discuss
0 0 0 0 t 0 0 0 t 0 0 t 0 t I 0 t 0 0 t t 0 If tt I 0 0 0 00 00 tt 0 0 0 I 0 0 0 0 0
COPIES: Secretary
Deputy Secretary- Tucker
I FILE REF NUMBER: 2012/08469
Joe Ludwig
I I 2013
Deputy Secretary- Mellor
PAS- Governance
I DATE Rli:CEIVED IN MO: I
Deputy Secreta!')'- Glyde
FAS-APD
Minute to Minister v3.2
s. 47F(1)
s. 22(1)(a)(ii)
FOI2012/13-72 Document 6
I FOR OFFICIAL USE ONLY
1, On 9 January 2013, you received a formal levy submission from the Australian Sweetpotato
Growers Association (ASPG) to introduce a statutory sweet potato marketing levy. DAFF then
initiated a six week period for objections to the levy from 11 January 2013 to 22 February
2013. .
- The ASPG' s submission was prepared after extensive industry consultation, followed by
a ballot of sweetpotato growers, run by the Electoral Commission. The ballot
demonstrated strong support fi:om sweetpotato growers for the introduction of a
marketing levy (91 per cent of returned ballots in favour; 7 per cent of returned ballots
against).
There is no statutory marketing levy on vegetables.
2. On 3 January 2013 Mr John Brent, Chair of AUSVEG, wrote to you raising concerns about the
sweet potato marketing levy (MNMC2013-00085; Attachment A). In your reply you
tmdertook to consider Mr Brent's letter as part ofthe government's deliberations on the
introduction of the sweet potato marketing levy and invited Mr Brent make a more detailed
submission during the obje.ction period (Attachment B).
3, Mr Brent's primary concerns are:
- The sweetpotato levy would lead to a decrease in administrative efficiency through the
need for Horticulture Australia Limited to establish separate consultation arrangements
for the sweetpotato industly.
The ASPG has failed to observe the Levy revenue service levy principles and guidelines
regarding industry body and levy payer consultation, because it did not consult with
AUSVEG.
- The approval of the sweetpotato levy would encourage other vegetable industries to
establish their own individual levies, leading to the fragmentation of the industly (and the
dilution of AUSVEG's role).
Mr Brent's concerns are discussed at Attachment C.
Can the ASPG propose a new levy and become an eligible industry body?
4. Regulations under the Primary Industries (Excise) Levies Act 1999 and the Primary Industries
(Customs) Charges Act 1999 (the imposition Acts) can name a body as the eligible industry
body for leviable horticultural products or a class or subclass of products. HAL must consult
this body before making recommendations to the minister on rates oflevy.
5. AUSVEG is named in regulations as the eligible industry body for the vegetable R&D levy
only.
6. If the government approved the introduction of a sweet potato levy, the Australian Sweet
Potato Growers' Association could be named as the eligible industry body for the sweet potato
marketing levy.
7. The Levy Principles and Guidelines (LPGs) require that a levy proposal is supported by
industry bodies representing, wherever possible, all existing and/or potential levy payers. The
LPGs do not preclude an industry body representing a subclass of a product that has an existing
levy.
8, Following the closure of the objection period, we will analyse all the objections received,
including those of AUSVEG, and develop advice for you on the establishment of the
sweetpotato marketing levy.
FOR OFFICIAL USE ONLY.
2
Mr John Brent, AUSVEG
20 February 2013
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Sweetpotato levy
I have received a fmmal proposal from the Australian Sweet Potato Growers (ASPG) to
introduce a marketiog levy for sweet potatoes.
The objection period for the levy closes soon (Friday, 22 February 2013).
As I advised in my reply [of22 January 2013], I will treat your letter as an objection.
I will consider the ASPG's proposal, together with the objections received, under the
government's Levy Principles and Guidelines.
This will include consideriog whether the proposal is supported by an industry body
representing all potential sweet potato levy payers.
Industry representation
The iodustry's representative arrangements are a matter for industry.
The ASPG would be recognised as the industry representative body only for the purposes of the
sweet potato marketing levy.
In tetms of managing horticulture industry levies, it's a balancing act between being centralised,
which is efficient, and beiog decentralised, which ensures everyone is adequately consulted. If
the HAL model is functioning effectively it should be able to deliver "the best of both worlds".
HAL governance concerns
I appreciate, and share, your concerns about ensuring the efficient and effective use of industry
levy funds and government matching funds.
As you know, I have asked the Department of Agriculture, Fisheries and Forestry to work with
HAL to develop a suite of proposals to improve HAL's govemance arrangements.
I understand you have been part of an industry consultative group that has worked with HAL in
developing these proposals.
This is still a work in progress and I expect to receive an update from the department on this
work shottly.
You have been involved with the industry a lot longer than I have and I welcome your thoughts
on the strengths and weaknesses of HAL's current arrangements.
Not applicable.
AUSVEG doesn't support the introduction of the sweet potato marketing levy.
Mr Brent is a member of an industry reference group that was consulted by HAL to help develop a
suite of proposals to improve HAL's governance all'angements.

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The Commonwealth matches statutory and voluntary levy investments in eligible research and
development through Horticulture Australia Limited (HAL; up to a limit of 0.5% of the GVP of the
horticulture industry). .
HAL invested $11.45 million io vegetable industry R&D in 2011-12, which included $5.5 million
of matching payments.
In 2011-12 the Commonwealth provided a total of$42 million of matching payments to HAL.
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20 February 2013
Attachment A: Incoming letter fi:omMr John Brent re: Sweetpotato marketing and promotions levy
Attachment B: Reply to Mr John Brent
Attachment C: Discussion of AUSVEG's concerns with the introduction of the sweetpotato
marketing levy
BRIEF
Peter Ottesen
APPROVED
Assistant Secretary
BY
Crops, Horticulture and Wine Branch
Agricultural Productivity Division
Phone:
CONTACT

OFFJCEn
Phone
lY
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s. 22(1)(a)(ii)
s. 22(1)(a)(ii)
s. 47F(1)
s. 22(1)(a)(ii)
20 February 2013
Attachment C
Decreased administrative efficiency associated with the establishment of the ASPG and the
Horticulture Australia Limited (HAL) sweet potato industry advisory committee (lAC).
I. The ASPG already exists and as such there will be no costs for its establishment. However, the
ASPG would be able to recover costs for industry consultation from HAL. HAL's Statutory
Funding Deed with the Commonwealth has guidelines for the payment of consultation costs to
peak industry bodies (P!Bs ). These guidelines preclude HAL from making payments to PIB 's
for agri-political activity, sitting fees and salaries or other running other than those directly
related to industry consultation on behalf of HAL.
2. The sweet potato marketing program would be managed by HAL, not the ASPG. There should
be.efficiencies of scale in HAL managing the sweet potato marketing levy in conjlmction with
the other 21 horticulture marketing levies it manages.
- In effect, there is an issue of HAL, at least in some cases, effectively sub-contracting the
management of funds to PIBs. This diminishes the efficiency of having HAL undertake
administrative functions on behalf of all horticultural industries and weakens HAL's
accountability for the industry and government funds it manages.
- HAL is putting in place a suite of refonns that will improve its governance arrangements.
- M:r Brent is a member of an industry reference group, composed of experienced industry
chairs, which HAL has consulted with in developing its proposals for a suite of
governance reforms.
ASPG has failed to observe the Levy revenue service levy principles and guidelines regarding
industry body and levy payer consultation.
3. We consider that the ASPG have so far complied with the Levy revenue service levy principles
and guidelines in developing the submission for a marketing levy on sweetpotatoes.
4. ASPG has been in discussion with the department since 5 December 2011 about their levy
proposal. At tbis meeting, the department advised the ASPG that we believed the levy
collection legislation can 'accommodate' a separate part in the horticulture schedules of the
regulations for a sweet potato marketing levy. The ASPG would be named as the prescribed
industry body for that marketing levy and AUSVEG would remain the prescribed industry
body for the R&D levy.
5. The ASPG advised the department that they had also been in discussions with AUSVEG in the
early stages of developing the proposal. At a meeting with DAFF officers on 14 Jlme 2012
ASPG stated that they would pursue the introductiqn of a statutory marketing levy, although
they knew it was opposed by AUSVEG.
Concerns tltat other commodity groups in the vegetable industry would follow the example of
the sweet potato industry, leading to industry fragmentation. . .
6. The department is advised by HAL that occasionally other commodity groups within the
vegetable industry express an interest in establishing their own levy. This is due to concerns
that the amount of R&D being funded on behalf of a particular commodity group from the
aggregated vegetable industry levy is less than the value of levies contributed by that
commodity group.
- For instance the sweet potato industry estimated that since the vegetable levy was
introduced, approximately $5.66 million of R&D levy and matching Commonwealth
funds had been collected on behalf of the sweet potato industry, but only $2.2 million had
been spent on R&D pmjects to benefit the industry.
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. 20 Febnmry 2013
7. In 2010 AUSVEG publically campaigned against the Australian Herb and Spice Industry
Association's (AHSIA) proposal for a separate R&D and biosecurity levy for the herb and
spice industry. AUSVEG also strongly opposed AHSIA's presumption of its status as the
designated industry body for the proposed levy.
8. Industry representative arrangements are a matter for industry.
9. There is not enough support within the vegetable industry as a whole for a marketing levy .
.AUSVEG's position precludes those vegetable industries that would support the establishment
of a marketing levy from pursuing the proposal.
Contact Officer:
Telephone:
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s. 22(1)(a)(ii)
s. 22(1)(a)(ii)
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Australian Government
T 0 Minister for Agriculture, Fisheries and Forestry
Minute No: MNBR2013/03041
Peter Ottesen
. Ph:
' Agricultural Productivity
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Mr Rodney Wolfenden, Chairman of Australian Sweetpotato Growers' Inc (ASPG)
Contact: Mob. . Information on ASPG and meeting participants is at Attachment A.
Date:
Time:
Saturday, 1 June 2013
9.00 am
Place; TBC [in the margins of the AUSVEG National Convention], Jupiters Gold Coast, Qld.
Not requested - DAFF Officer Peter Ottesen, AS Crops, Horticulture and Wine Branch, APD, will
attend the AUSVEG Conference sessions and will be available to sit in on this meeting, if required.
The meeting is to discuss the proposed levy on sweet potato for marketing and promotion. We
expect Mr Wolfenden will seek to counter criticism of the proposal by AUSVEG, including
AUSVEG's claim that it was not consulted on the proposal.
This minute provides key points and detailed information on the issues associated with the proposed
marketing (and promotions) sweet potato levy.
That you:
/-'),
1. Note and draw upon the information as required .
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COPIES'
Secretary
roted I Please Discuss
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'"_lftdwig
. /02013
F AS - Governance
Deputy Secretary- Glyde
FAS-
I FILE REF NUMBER: 2013-02390 ----'---'''-D_A_T_E_R_E_C_E_I,_'E_D_IN_i\1_0_: _________ __J
Minute to Minister v3 .2
s. 47F(1)
s. 22(1)(a)(ii)
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Mr Rodney Wolfenden, ASPG
9.00am 1 June 2013
The ASPG has requested (submission lodged 9 January 2013) the government to introduce a
marketing levy collected on sweet potatoes as follows:
- an ad valorem statutory marketing levy at a rate of one percent of the wholesale price on
all sweet potato sales collected at the first domestic point of sale; and
- an ad valorem statutory marketing export charge at a rate of one percent of the
wholesale price on all sweet potato export sales.
This marketing levy would be administered separately from the existing research and
development (R&D) levy on vegetables- there would be no change to the existing vegetable
R&D levy which is set at a rate of 0.5 percent of the wholesale value at first point of sale after
production. AUSVEG would continue to be the industry representative body for the vegetable
R&D levy. There is no statutory marketing levy on vegetables.
The levy proposal would have the ASPG as the industry' representative body for the sweet
potato marketing levy and establish a Horticulture Australia Ltd industry advisory committee.
As part of the ASPG's consultation process in the lead up to lodging its submission to the
government, a postal ballot of potential levy payers was conducted by the Australian Electoral
Commission with a strong voter turnout (80 percent of growers) and with 91 percent of those
voting in favour.
In accordance with the government's Levy principles and guidelines, an objection period for the
levy proposal commenced on 11 January 2013 and concluded on 22 February 2013.
- One objection was received, from AUSVEG, which is concerned the proposed new levy
(which would recognise ASPG as the industry representative body for the marketing
levy) would fragment the vegetable industry. AUSVEG also claimed not to have been
consulted and cast doubt on the value of a marketing program for sweet potato.
- You wrote to AUSVEG on 22 January and 12 March 2013 noting their objections would
be taken into account when he considers the levy proposal.
- A discussion of the concerns raised by AUSVEG is provided at Attachment B.
ASPG wrote to you on 5 April 2013 outlining the communication ASPG has undertaken with
AUSVEG in relation to its marketing levy proposal (a copy of the letter is at Attachment C).
While our formal advice will be provided in forthcoming briefing to you, on a prima facie basis
it would appear ASPG has undertaken a satisfactory level of consultation with AUSVEG.
DAFF processing of the proposed marketing levy
Treasury has cleared a costing for the proposed sweet potato marketing levy.
The Offtee of Best Practice Regulation (OBPR) advised on 22 March 2013 that a Regulation
Impact Statement (RIS) is required for the proposal (ID 14851 ). A draft RIS is being prepared.
Next steps
Assuming the OBPR clears the RIS, DAFF will provide you with a briefing to seek your
consideration of policy approval for the proposal and the Office of Parliamentary Counsel will
then be asked to commence drafting the Regulations needed to give effect to it.
DAFF is aiming to have the new arrangements start on 1 October 2013 (the start of a quarterly
levy return period) in line with the ASPG' s request that the levy commence as soon as possible.
o To achieve this timing, assuming the RIS is approved and you give policy approval, the
Treasurer's agreement and Prime Minister's support respectively will be needed sufficiently in
advance of the last Executive Council meeting on 8 August 2013 (cut off for final papers is
31 July 2013).
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Sweet potato levy
9.00am l June 2013
I have received the Australian Sweetpotato Growers' (ASPG) formal proposal to introduce a
marketing levy for sweet potatoes.
The objection period for the proposed levy closed on Friday, 22 Febmary 2013.
I received a letter of objection from AUSVEG.
I will consider the ASPG's proposal, together with the objection received, under the
government's Levy principles and guidelines, once a Regulation Impact Statement has been
prepared and I have received advice from the Department of Agriculture, Fisheries and Forestry.
Industry representation
The industry's representative arrangements are a matter for industry.
The ASPG would be recognised as the industry representative body only for the purposes of the
sweet potato marketing levy.
You will appreciate the government's desire to ensure the efficient and effectiveuse of industry
levy funds and government matching funds.
ASPG is concerned about AUSVEG's opposition to the introduction of the proposed sweet potato
marketing levy.
Attaclm1ent A:
Attachment B:
Attachment C:
Background on organisation and meeting participants
Discussion of AUSVEG' s concerns with the sweet potato marketing levy
ASPG's letter dated 5 April2013- consultation with AUSVEG
BRIEF
Peter Ottesen
APPROVED
Assistant Secretary
BY
Crops, Hm1iculture and Wine Branch
Agricultural Productivity Division
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s. 22(1)(a)
(ii)
s. 22(1)(a)(ii)
s. 47F(1)
s. 22(1)(a)(ii)
9.00am I June 2013
Attachment A

The Australian Sweetpotato Growers Inc. (ASPG)
The ASPG is a non-profit, member-based organisation and represents the interests of the sweet
potato industry. The ASPG had its origins as an informal grouping of major growers that came
together around nine years ago to provide input to various R&D projects being run at the time
through the Queensland Department of Primary Industries.
That experience led the growers to form an incorporated association in May 2007 (registered as
an incorporated association with the Queensland Office of Fair Trading on 31 May 2007).
The ASPG has 53 financial members and claims that, combined; its members are responsible
for 80-90 percent of national sweet potato production. Growers pay an arrnual membership fee
and a small voluntary levy on seed sweet potato purchase. This levy goes to fund certain ASPG
activities.
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' ' ASPG officeholders
Rodney Wolfenden
Rodney Wolfenden is the current President of the ASPG Inc. He is
also the ASPG Inc project leader for the HAL research and
development project VG09009 "Evaluating sweetpotato varieties
to meet market needs".
Mr Wolfenden and his family farm sweet pulalues on fertile red
volcanic soil at Rossmoya in Central Queensland. The family have
grown and packed sweet potatoes at Rossmoya for 20 years and
the majority of the sweet potatoes are marketed through the
Brisbane central markets.
Rodney is currently a board member of Growcom Pty Ltd,
Queensland's horticulture industry's peak body.
1. ; Eric Coleman, mobile:
Mr Coleman is the Secretary of ASPG. His family farm is
situated on the Fitzroy floodplain at Gracemere, west of
Rockhampton in Central Queensland.
The Coleman family farm produces a range of foods that
appear on the menu for most families including sweet
potatoes, sweet corn, zucchini, pumpkins as well as melons.
Mr Coleman was previously a senior horticultural extension
officer with the Queensland Department of Primary
Industries and Fisheries.
Russell McCrystal, mobile: (") sl<J
Mr McCrystal is and a researd {x:I,(C, \ '"'-J "'- \)W-e
a research Hmiiculturist with the Queensland Department of Primary Industrie
and February 2012 (9 years 10 months). \'"'-c"-f'
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s. 47F(1)
s. 47F(1)
s. 47F(1)
9.00am 1 June 2013
Attachment B

Decreased administrative efficiency associated with the establishment of the ASPG and the
Horticulture Australia Limited (HAL) sweet potato industry advisory committee (lAC).
1. The ASPG already exists and as such there will be no costs for its establishment. However, the
ASPG would be able to recover costs for industry consultation from HAL. HAL's Statutory
Funding Deed with the Commonwealth has guidelines for the payment of consultation costs to
peak industry bodies (PIBs). These guidelines preclude HAL from making payments to PIB's
for agri-political activity, sitting fees and salaries or other running costs other than those
directly related to industry consultation on behalf of HAL.
2. The sweet potato marketing program would be managed by HAL, not the ASPG. There should
be efficiencies of scale in HAL managing the sweet potato marketing levy in conjunction with
the other 21 horticulture marketing levies that it manages.
\- ) ASPG has failed to observe the Levy revenue service levy principles and guidelines regarding
industry body and levy payer consultation.
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3. We consider that the ASPG have so far complied with the Levy revenue service levy principles
and guidelines in developing the submission for a marketing levy on sweet potatoes.
4. ASPG has been in discussion with DAFF since 5 December 20 ll about the proposal. At this
meeting, DAFF advised the ASPG that we believed the levy collection legislation can
'accommodate' a separate part in the horticulture schedules of the regulations for a sweet
potato marketing levy. The ASPG would be named as the prescribed industry body for that
marketing levy and AUSVEG would remain the prescribed industry body for the R&D levy.
5. The ASPG advised DAFF that they had also been in discussions with AUSVEG in the early
stages of developing the proposal. At a meeting with DAFF officers on 14 June 2012 ASPG
stated that they would pursue the introduction of a statutory marketing levy, although they
knew it was opposed by AUSVEG.
Concerns that other commodity groups in the vegetable industry would follow the example of
the sweet potato industry, leading to industry fragmentation.
6. DAFF has been advised by HAL that occasionally other commodity groups within the
vegetable industry express an interest in establishing their own levy. This is due to concerns
that the amount of R&D being funded on behalf of a particular commodity group from the
aggregated vegetable industry levy is less than the value of levies contributed by that
commodity group.
- The sweet potato industry complained that since the vegetable levy was introduced,
approximately $5.66 million of R&D levy and matching Commonwealth funds was
collected on behalf of the sweet potato industry; but only $2.2 million had been spent on
R&D projects to benefit the indust1y.
7. In 2010 AUSVEG publically campaigned against the Australian Herb and Spice Industry
Association's (AHSIA) proposal for a separate R&D and biosecurity levy for the herb and
spice industry. AUSVEG also strongly opposed AHSIA 's presumption of its status as the
designated industry body for the proposed levy. Subsequently in a ballot, levy-payers voted
against the AHSIA proposal.
8. Industry representative arrangements are a matter for industry.
9. There is not enough support within the vegetable industry as a whole for a marketing levy.
AUSVEG's position precludes those vegetable industries (such as sweet potatoes with this
case) that want a marketing levy and wish to pay for it.
5
5 April 2013 Au..<;tratinn sweetpotato
c;rowers fPW
Senator the Hon Joe Ludwig
PO Box4350
Minister for Agriculture, Fisheries and Forestry
PO Box 6022
Bunda berg South QLD 4670
ABN:82577850667
Parliament House
CANBERRA ACT 2600
Dear Minister
Re: Sweetpotato Marketing Levy Proposal- Your letter of 12 March to Andrew White, AUSVEG
Thank you for forwarding a copy of your letter responding to correspondence from Andrew White,
Acting Chief Executive Officer, AUSVEG. The Australian Sweetpotato Growers Association Inc. (ASPG)
would like to provide you with additional information regarding communication with AUSVEG in
relation to the proposal for establishment of a levy on Sweetpotatoes to fund essential marketing
activity.
Specific contact with AUSVEG
Specific contact with AUSVEG on the levy proposal has been:
APRIL 2011
At the AUSVEG National Convention in Brisbane ASPG initiated a meeting to discuss specific
issues related to the Sweetpotato industry, including the pressing need for a levy to fund
marketing and promotion.
Participants in that meeting were, from ASPG, Rodney Wolfenden (President), Dean Akers
(Executive Committee Member) and Russell McCrystal; and from AUSVEG, Richard Mulcahy
(Chief Executive Officer) and Courtney Burger (Communications Officer).
20 March 2012
This meeting, also requested by ASPG, was at held at Bunda berg prior to a scheduled
Vegetable Industry Levy Payers Meeting.
ASPG provided an agenda beforehand which included:
1. Highlight the current industry situation, including the likelihood of continued
production increases into the future.
2. Present a detailed discussion paper titled 'Examining options to maximise
Sweetpotato levy-payer benefit, through industry-specific R&D and marketing
activity'.
3. Hold discussions around the most effective means to implement ASPG's plan to
drive consumer demand for Sweetpotato.
AUSVEG undertook to respond to ASPG on the matters raised.
Participating in that meeting were, from AUSVEG Richard Mulcahy, Andrew White (Manager,
Industry Development and Communications) and Danny De leso (Member of the Vegetable
Industry Advisory Committee); and from ASPG, Rodney Wolfenden, Dean Akers, Duane Joyce
(Executive Committee Member) and Russell McCrystal
As requested by AUSVEG, on March 21 ASPG provided an electronic copy of the paper,
'Examining options to maximise Sweetpotato levy-payer benefit, through industry-specific
R&D and marketing activity'
11 May 2012
At the AUSVEG National Convention in Hobart ASPG again requested a meeting with AUSVEG
to seek responses to the matters raised at the March 20 meeting. Participating on that
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occasion were Duane Joyce and Russell McCrystal from ASPG; Richard Mulcahy of AUSVEG
and Will Gordon, Industry Services Manager with Horticulture Australia Ltd (HAL).
The ASPG participants outlined progress in levy discussions and specifically reported on the
outcome of the April 2012 ASPG Annual General Meeting where:
By show of hands, there was unanimous support for a motion that ASPG formally
propose a levy of 1% to fund marketing and promotion.
It was recognised that this was not a formal ballot on the proposal but nevertheless
a very strong indication of grower support.
The meeting also discussed and agreed that arrangements regarding the existing
R&D Levy (i.e. Sweetpotatoes covered as part of the wider 'Vegetable Levy') should
remain unchanged.
Mr. Mulcahy undertook to respond to ASPG on the matters related to marketing and
promotion and the proposed marketing levy.
11 May 2012
Also at the National Convention, Duane Joyce and Russell McCrystal of ASPG spoke with John
Brent, AUSVEG Chairman. Discussions already held with AUSVEG executives were outlined as
was the ASPG's intention to seek establishment of a levy to fund marketing and promotion
activity.
Again, the outcomes of the ASPG AGM (covered above) were detailed.
20 May 2012
Email from Richard Mulcahy to Russell McCrystal making it clear that AUSVEG would not
support the creation of any new levy "outside of the existing PIB structure".
Communication with other bodies and DAFF
It is relevant to also detail ASPG's communication with other bodies related to both ASPG and
AUSVEG.
Growcom -one of the seven State/Territory association Members of AUSVEG
ASPG (through Chairman, Rodney Wolfenden and Secretary, Eric Cole) has had discussions
with Growcom's from 2010 to the current time. These discussions
have covered various matters of relevance to the Sweetpotato industry and have specifically
included the need for the establishment of a statutory levy to fund essential marketing
activity.
Bunda berg Fruit and Vegetable Growers (BFVG)- one of the four Associate Members of
AUSVEG
The Bunda berg region is responsible for more than 75% of Australia's Sweetpotato
production and so is very important to the industry nationally. Similarly, the Sweetpotato
industry is a vital part of the economy of the Bunda berg region. Therefore ASPG has close
and regular contact with BFVG.
Rodney Wolfenden, Duane Joyce and Russell McCrystal of ASPG have discussed the
industry's levy proposal and submission with .
Horticulture Australia Ltd (HALl
Throughout the levy proposal, ballot and submission ASPG have kept HAL informed of its
intentions and progress with the process.
The first meeting to discuss ASPG's proposals was on 14 December 2011, and involved
. Rodney Wolfenden, Duane Joyce and Eric Coleman from ASPG and John Lloyd (Chief
Executive Officer and Warwick Scherf, General Manager -Industry Services from HAL
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On 11 May 2012, at the AUSVEG National Convention, Duane Joyce and Russell McCrystal of
ASPG met with HAL executives Warwick Scherf, David Chenu (General Manager, Marketing)
and Will Gordon. At that meeting the HAL team was updated on ASPG's intentions and
progress regarding the proposed new Marketing levy. They were also advised of the
discussions and vote at the ASPG Annual General Meeting in April (see earlier mention).
Lastly, when the HAL Board visited Bundaberg in August 2012 they visited Darren
Zunker's farm. They were given a brief presentation and a document which provided
background on the Sweetpotato industry and its plans to seek Ministerial approval for a
Marketing Levy.
Department of Agriculture, Fisheries and Forestry
ASPG has maintained contact with DAFF staff in Horticulture Policy and DAFF-Levies
throughout the whole levy consultation, ballot and proposal process. Their advice has been
very helpful.
On December 20, 2012 a member of DAFF staff contacted ASPG Secretary (Eric Coleman) to
ask if his contact details could be given to William Churchill of AUSVEG. Mr. Coleman agreed
however there was no subsequent contact from AUSVEG.
Publicly available information
Lastly, information about the industry's proposal for a levy has been in the public domain right
throughout the process:
Background information on the levy proposal was mailed to all growers and was available to
anyone upon request to ASPG.
Details of the regional meetings held to discuss the levy proposal were mailed to all growers,
advertised in regional press, covered through regional publicity.
Details of the levy proposal were covered in a number of press articles and regional radio
segments/interviews.
Participation in the grower ballot was encouraged and promoted via a direct mailing to all
growers, advertising in regional press and media publicity.
Once the formal submission had been prepared it was also made available to all growers,
upon request to ASPG. One request was received and fulfilled.
The opportunity to lodge objections to the levy proposal has been promoted on
http:Uwww.aspg.com.au
ASPG trusts that this additional information will assist DAFF and the Minister in considering the
proposal for establishment of a Marketing Levy and recognition of ASPG as the Prescribed Industry
Body for the purposes of this Levy.
Minister, there is very strong industry support for the ASPG's levy proposal. In the formal ballot of
potential levy-payers:
80% of growers participated
92.5% of the eligible votes were in favor of the proposal
And in addition, as detailed in ASPG's submission:
16 major growers representing over 70% of national production (ASPG calculation) have
specifically and publicly declared their support for the levy proposal.
Therefore, it is of the utmost importance that the levy be introduced as soon as possible. Grower
profitability is suffering while-ever we are unable to use our own funds, via statutory levy, to promote
our product.
3
s. 47F(1)
Opportunity to meet
We are keen to provide any other information you may require and we now formally request the
opportunity to discuss our proposal and this additional information with you. We are available to
meet at any time suitable for yourself either in Canberra or your electoral office in Brisbane. If you
need further information on this matter please contact myself on or Eric Coleman on
.
Yours sincerely
Rodney Wolfenden
Chairman
Australian Sweetpotato Growers Inc.
cc
Peter Ottesen- Assistant Secretary, DAFF
4
s. 47F(1)
s. 47F(1)
s. 47F(1)
TO
Minute No: MNMT2013/
Australian Government Peter Ottesen
Department of Agriculture, Fisheries and Forestry Ph:
Ag Productivity
'tf;tl,tlt jCj

:rR.tP:Rl't::. ..
SWEET POTATO LEVY PROPOSAL
For decision
Normal business
<:' NIA
QF ' ,.
The Australian Sweetpotato Growers' Association (ASPG) is requesting the introduction of a
marketing levy on sweet potatoes. Your agreement is sought to progress the levy proposal so that
the new levy becomes operative by [I January 2014].

That you:
a. N otc that the ASPG has provided a submission requesting introduction of:
I. an ad valorem statutory marketing levy to be set at one percent of the sale price on all
sweet potato sales, collected at the first domestic point of sale; and
2. an ad valorem statutory marketing export charge to be set at one percent of the free-on-
board value of sweet potato applying immediately before export (not payable if the
marketing levy has already been paid for the sweet potato).
b. Note that AUSVEG has written to you raising objections to the levy proposal.
c. Agree to the ASPG's requested levy and export charge on sweet potatoes for marketing.
Agreed I Not Agreed I Please Discuss
d. Sign, but do not date, the attached letter to the Prime Minister seeking her support for the
proposed levy (Enclosure 1)
Signed I Not Signed I Please Discuss
e. Sign the attached letter to the Treasurer seeking his agreement for the proposed levy
(Enclosure 2)
COl'IES: Secretary
I FILE REF NUMBER: 2013/02390
Signed I Not Signed I Please Discuss
Joe Ludwig
I I 2013
Deputy Secretary- Glyde
F AS -Governance
I DATE RECEIVED IN MO:
FAS-
Minute to Minister or Pari Sec v3 .11.
s. 22(1)(a)(ii)
1. On 21 December 2012 Horticulture Australia Limited (HAL) wrote to you (Attachment A)
forwarding a copy of the ASPG's submission dated 11 December 2012 (Attachment B) that
seeks your agreement to introduce a marketing levy on sweet potatoes set at a rate of 1.0 per
cent of the price at the first point of sale and levy funds raised to be paid to HAL.
2. This marketing levy would be administered separately from the existing research and
development (R&D) levy on vegetables (i.e. including sweet potatoes) payable to HAL. The
R&D levy will continue to be administered by HAL with industry advice through AUSVEG.
3. It is your role under the primary industry levies legislation (see Background) to consider
proposals for new or amended levies, or the abolition of levies.
4. The proposed new levy would require amendments to the Primary Industries (Excise) Levies
Regulations 1999, the Primary Industries (Customs) Charges Regulations 2000 and the
Primary Industries Levies and Charges Collection Regulations 1991 made under the Primary
Industries (Excise) Levies Act 1999, the Primary Industries (Customs) Charges Act 1999 and
the Primary Industries Levies and Charges Collection Act 1991.
Consultation
5. The ASPG's submission was prepared after extensive industry consultation process including:
media coverage, posting information on the proposal to known growers and conducting two
regional grower meetings in major sweet potato production areas (in Cudgen, NSW and
Bundaberg, Qld).
The ballot
6. The Australian Electoral Commission (AEC) conducted a ballot of sweet potato growers with
ballot papers posted to all identified potential levy payers on the Voting Register on
26 October 2012 and the ballot closing at 12.00 noon on 19 November 2012.
7. Eighty-five potential sweet potato growers were registered for the ballot. More than 80 per
cent of these growers voted, with 91 per cent of votes in favour of the proposed levy/charge.
This result indicated that sweet potato growers strongly support the introduction of a new
compulsory marketing levy/export charge.
The objections
8. In accordance with the Australian Government's Levy principles and guidelines (LPGs), a six-
week period for objections ran from 11 January 2013 to 22 February 2013. Only AUSVEG
(MNMC2013/00085 & MNMC2013/01116) lodged objections to the levy proposal.
9. AUSVEG's primary concerns are:
- The sweet potato levy would lead to a decrease in administrative efficiency through the
need for HAL to establish separate consultation arrangements for the sweet potato
industry.
- The ASPG has failed to observe the LPGs regarding industry body and levy payer
consultation, because it did not consult with AUSVEG.
- The approval of the sweet potato levy would encourage other vegetable industries to
establish their own individual levies, leading to the fragmentation of the indushy (and
the dilution of AUSVEG's role).
Doubt that a generic sweet potato marketing levy will generate significant net benefits.
2
'
I
10. On balance AUSVEG's arguments are not convincing and their concerns are discussed at
Attachment C.
11. Based on outcomes of the consultation, ballot and objection process DAFF believes there is
little opposition to the levy changes from sweet potato growers.
12. Accordingly, DAFF recommends that you agree to the introduction of a sweet potato
marketing levy as proposed by the ASPG.
13. DAFF prepared a Regulation Impact Statement (RlS) that considered a range of options from
maintaining the status quo to implementing the ASPG' s proposal. The analysis concluded that
the ASPG' s proposal was the most effective means of correcting market failure in funding
marketing activities for the industry. The Office of Best Practice Regulation (OBPR) has
assessed the RlS as adequate (ID 14851 ). The assessment by OBPR, a one page summary and
a copy of the RlS are included as attachments to Enclosures 1 and 2.
14. The government's Budget Operational Rules require you to seek the endorsement of both the
Prime Minister and Treasurer for any new proposal with financial implications for the
government. If you agree to the ASPG's proposal, you will therefore need to sign the enclosed
letters (Enclosures 1 and 2) to the Prime Minister and Treasurer seeking their support and
approval, respectively.
You are requested to sign but not date the enclosed letter to the Prime Minister. The
Prime Minister will respond to your letter once the Treasurer has agreed to the proposal.
Your office has indicated it will hold the Prime Minister's letter pending the Treasurer's
agreement and date it appropriately before sending.
This approach has been agreed with both your office and the Prime Minister's office.
Next steps
15. If you agree to write to the Prime Minister and the Treasurer seeking their endorsement of the
ASPG's levy proposal, DAFF will:
ask the Office of Parliamentary Counsel to draft the instruments (Regulations);
prepare Executive Council documents and seek clearance of them from the Executive
Council Secretariat; and
prepare a minute to the Parliamentary Secretary seeking his approval of the Regulations
and supporting documentation required to implement the ASPG's proposal.
16. If you agree, and if the Prime Minister and Treasurer subsequently endorse the requests (as
required under the government's Budget Operational Rules) DAFF will aim to have the new
arrangements start on [1 January 2014], in line with the ASPG's expectations.
Medium- AUSVEG, the peak industry body for vegetables, doesn't support the introduction of
the sweet potato marketing levy.
...... c.
The Stakeholder Relationships and Legislation Section and the External Budget and Strategy
Branch in the Finance and Business Support Division have been consulted in the preparation of
this minute.
The Treasury and the Department of Finance and Deregulation (DoFD) have been consulted on the
levy proposal. The Office of Best Practice Regulation has approved a RIS (ID 14581 ).
''
There are no financial impacts. A costing has been agreed with the Treasury and DoFD, through
the External Budget Section. The ASPG's proposed sweet potato marketing levy is expected to
raise $800,000 annually. The marketing levy does not attract matching government payments.
3
.FOR OFFICIAL USE ONLY
N/A
MNBR2013/01007- Minute for meeting with John Brent, AUSVEG Chairman, on
20 February 2013.
Sweet potatoes are grown mostly in Queensland and New South Wales. In 2010, Queensland
accounted for an estimated 79 per cent of Australia's production, NSW 20 per cent, Western
Australia 1 per cent, and South Australia less than 1 per cent. Sweet potato production is heavily
concentrated with the Queensland region of Bundaberg representing 85 per cent of growers and
78 per cent of national production.
There are currently around 82 farms growing sweet potatoes commercially. The scale of sweet
potato farms ranges from the largest of 200 hectares to smaller holdings of just 10 hectares. Most
properties are in the 15-80 hectare size range.
Since 1 March 1996, vegetable growers, including sweet potato growers, have paid a statutory
levy or export charge to provide funding for research and development (R&D) commissioned by
HAL, and for Plant Health Australia (PHA) membership through AUSVEG, the peak industry
body for vegetables. The levy is payable on vegetables that are produced in Australia and sold by
the grower, or used in the production of other goods. The export charge is payable on vegetables
that are produced in Australia and exported from Australia. No export charge is payable if a
domestic levy has already been paid on the vegetables to be exported.
The rate of the current vegetable levy and export charge is 0.5 per cent of the sale price on
vegetables sold on the fresh domestic market, exported or directed to processing, collected at the
first point of sale. Of this, the rate of the R&D levy component is 0.485 per cent of the sale value.
The rate of the other (PHA) levy component is 0.015 per cent of the sale value. Any surplus after
the PHA membership fee is paid is directed to HAL for expenditure on R&D projects.
The vegetable (R&D and PHA) levy and exp01t charge will remain unchanged.
Levies legislation
Three pieces of Commonwealth legislation, the Primary Industries (Excise) Levies Act 1999, the
Primary Industries (Customs) Charges Act 1999 and the Primary Industries Levies and Charges
Collection Act 1991 enable primary industries to have statutory levies and/or export charges
imposed on producers of primary industry products.
Regulations made under these Acts, namely the Primary Industries (Excise) Levies Regulations
1999, the Primary Industries (Customs) Charges Regulations 2000 and the Primary Industries
Levies and Charges Collection Regulations 1991, set the rate of levy and/or export charge and
outline the collection mechanism.
Proposals for new or changed primary industry levies are assessed against the LPGs and to go
forward must be approved by the Minister.
BRIEF
Peter Ottesen
APPROVED
Assistant Secretary
BY:
Crops, Horticulture and Wine
Ag Productivity
Phone:
CONTACT
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
OFFICER: Phone
I 12013
4
s. 22(1)(a)
(ii)
s. 22(1)(a)(ii)
s. 22(1)(a)(ii)
I<'OR OFFICIAL USE ONLY
Attachment A: HAL letter dated 21 December 2012
Attachment B: ASPG letter dated 11 December 2012
Attachment C: Discussion of AUSVEG's concerns with the introduction of the sweet potato
marketing levy
Enclosure 1: draft letter to the Prime Minister for your signature
Enclosure 2: draft letter to the Treasurer for your signature
5
Attachment A
(.
6
Senator the Hon. Joe Ludwig
Senator for Queensland
The Hon Julia Gillard MP
Prime Minister
Parliament House
CANBERRA ACT 2600
Dear Prime Minister
I seek your support for my decision to approve a proposal by the Australian Sweetpotato
Growers' Association (ASPG) to introduce a marketing levy and export charge on sweet
potatoes.
The Primary Industries (Excise) Levies Act 1999, the Primary Industries (Customs) Charges
Act 1999 and the Primary Industries Levies and Charges Collection Act 1991 provide the
framework for the imposition and collection of primary industry levies and export charges.
Regulations made under the relevant Acts set the rate of levy and export charge imposed on
each industry and the method of collection. To implement the proposed levy changes on
sweet potatoes, amendments would be required to the Primary Industries (Excise) Levies
Primary Industries Levies and Charges Collection Regulations 1991.
The ASPG proposal is to introduce:
a. an ad valorem statutory marketing levy to be set at one percent of the sale price on all
b. an ad valorem statutory marketing export charge to be set at one percent of the free-on-
The ASPG wishes to introduce the statutory levy/export charge for sweet potatoes to secure
funding for the long-term needs and priorities of the industry as identified in the Australian
industry's 2013-2016 Strategic Marketing Plan. The ASPG also recognises the need to
stimulate consumption through a considerably increased marketing and promotion program.
The funds raised would be paid to Horticulture Australia Limited as the marketing service
provider. The ASPG has asked that the levy changes be implemented as soon as possible.
The ASPG conducted a thorough consultation campaign with all known commercial sweet
potato growers: including media coverage, posting infmmation on the proposal to known
growers and conducting two regional grower meetings in major sweet potato production
areas. The Australian Electoral Commission conducted a postal ballot of sweet potato growers
on a "one vote per enterprise" basis for the proposed levy changes and received a strong
positive outcome (91% of votes in favour).
Parliament House, Canberra ACT 2600 Telephone: 02 6277 7520 Facsimile: 02 6273 4120
No objections to the levy proposal were raised by levy payers during the 6 week objections
period which ended on 22 February 2013. AUSVEG, the peak industry body for the broader
vegetable R&D levy, raised concerns which I believe have been adequately addressed.
I am satisfied the ASPG proposal meets the Australian Government's Levy principles and
guidelines. The ASPG's submission provides evidence of wide industry consultation and
gives an assessment of the consequences of not introducing the marketing levy and export
charge.
Implementing the ASPG request would bring considerable benefit to the sweet potato industry
through enabling important marketing activities to be undertaken in line with its Strategic
Plan. Consumers would also benefit from being informed about the human health and
nutritional benefits arising from consuming sweet potatoes.
The Department of the Treasury has confirmed the changes will have no net impact on the
Commonwealth. The Office of Best Practice Regulation has approved a regulation impact
statement (RIS) for the proposed levy charges (OBPR ID No 14581). QBPR's approval letter,
a one page summary and a copy of the RIS is attached.
I therefore seek your support for my decision to approve the proposed levy changes on sweet
potatoes. The industry expectation is that the new rates will be operative by 1 January 2014.
To achieve this start date, I would appreciate your timely consideration of my request
sufficiently in advance of the last scheduled Executive Council meeting on [date] (cut off for
final papers is [date]).
The contact oflicer in the department on the proposal is Peter Ottesen, Assistant Secretary,
Crops, Horticulture and Wine on .
I have written to the Treasurer, the Hon Wayne Swan MP, in similar terms, and sent a copy of
this letter to Senator the Hon Penny Wong, Minister for Finance and Deregulation for her
information.
Yours sincerely
Joe Ludwig
cc Senator the Hon Penny Wong, Minister for Finance and Deregulation
Enc.
':,-
s. 22(1)(a)(ii)
Senator the Hon. Joe Ludwig
The Hon Wayne Swan MP
Treasurer
Parliament House
CANBERRA ACT 2600
Dear Treasurer
I seek your agreement to my decision to approve a proposal by the Australian Sweetpotato
Growers' Association (ASPG) to introduce a marketing levy and export charge on sweet
potatoes.
The Primary Industries (Excise) Levies Act 1999, the Primary Industries (Customs) Charges
Act 1999 and the Primary Industries Levies and Charges Collection Act 1991 provide the
framework for the imposition and collection of primary industry levies and export charges.
Regulations made under the relevant Acts set the rate of levy and export charge imposed on
each industry and the method of collection. To implement the proposed levy changes on
sweet potatoes, amendments would be required to the Primary Industries (Excise) Levies
Primary Industries Levies and Charges Collection Regulations 1991.
The ASPG proposal is to introduce:
a. an ad valorem statutory marketing levy to be set at one percent of the sale price on all
b. an ad valorem statutory marketing export charge to be set at one percent of the free-on-
The ASPG wishes to introduce the statutory levy/export charge for sweet potatoes to secure
funding for the long-term needs and priorities of the industry as identified in the Australian
industry's 2013-2016 Strategic Marketing Plan. The ASPG also recognises the need to
stimulate consumption through a considerably increased marketing and promotion program.
The funds raised would be paid to Horticulture Australia Limited as the marketing service
provider. The ASPG has asked that the levy changes be implemented as soon as possible.
The ASPG conducted a thorough consultation campaign with all known commercial sweet
potato growers: including media coverage, posting information on the proposal to known
growers and conducting two regional grower meetings in major sweet potato production
areas. The Australian Electoral Commission conducted a postal ballot of sweet potato growers
on a "one vote per enterprise" basis for the proposed levy changes and received a strong
positive outcome (91% of votes in favour).
Parliament House, Canberra ACT 2600 Telephone: 02 6277 7520 Facsimile: 02 6273 4120
No objections to the levy proposal were raised by levy payers during the 6 week objections
period which ended on 22 February 2013. AUSVEG, the peak industry body for the broader
vegetable R&D levy, raised concerns which I believe have been adequately addressed.
I am satisfied the ASPG proposal meets the Australian Government's Levy principles and
guidelines. The ASPG's submission provides evidence of wide industry consultation and
. gives an assessment of the consequences of not introducing the marketing levy and export
charge.
Implementing the ASPG request would bring considerable benefit to the sweet potato industry
through enabling important marketing activities to be undertaken in line with its Strategic
Plan. Consumers would also benefit from being informed about the human health and
nutritional benefits arising from consuming sweet potatoes.
The Department of the Treasury has confrrmed the changes will have no net impact on the
Commonwealth. The Office of Best Practice Regulation has approved a regulation impact
statement (RIS) for the proposed levy charges (OBPR ID No 14581). OBPR's approval letter,
a one page surmnary and a copy of the RIS is attached.
I therefore seek your agreement to my decision to approve the proposed levy changes on
mushrooms. The industry expectation is that the new rates will be operative by I January
2014. To achieve this start date, I would appreciate your timely consideration of my request
sufficiently in advance of the last scheduled Executive Council meeting on [date] (cut offfor
final papers is [date]).
The contact officer in the department on the proposal is Peter Ottesen, Assistant Secretary,
Crops, Horticulture and Wine on
I have written to the Prime Minister, the Hon Julia Gillard MP, in similar terms, and sent a
copy of this letter to Senator the Hon Penny Wong, Minister for Finance and Deregulation for
her information.
Yours sincerely
Joe Ludwig
June 2013
cc Senator the Hon Penny Wong, Minister for Finance and Deregulation
Enc.
s. 22(1)(a)(ii)

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