We:
Hon. Graeme Stoney, MLC Deputy Chair
Mr. Craig Ingram, MP
Mr. Hugh Delahunty, MP
Mr. Terry Mulder, MP
Submit this minority report in response to the inquiry into the control of Ovine Johne's Disease in Victoria by the Environment and Natural Resources Committee of the Parliament of Victoria.
We agree with all the recommendations as listed in Chapter 12 of the main Report. Three additional recommendations submitted by the writers of this Minority Report are pivotal to the main Report. These recommendations arrive at a logical conclusion to the evidence and submissions, and are as follows:
1. "That the State Government supports the OJD Compensation Fund to the extent of half the present debt."
2. That the State Government support the OJD Compensation Program from its suspension date in November 1999, on a dollar for dollar basis with industry, subject to a review when the national OJD Control and Evaluation Program is handed down in 2003.
3. That the State Government apply to the Federal Government for assistance to support the OJD Compensation Fund.
These three recommendations are not in the main report because they were voted out.
During the Committee's deliberations, variations of the above recommendations, covering the same intent as the above and which provided for a logical conclusion, were moved by various committee members. Committee discussions on these motions were held on two separate days and two votes taken. In their final form the three motions were as shown above. The minutes record that at one committee meeting, three motions of the same intent as the above, were lost and that four Committee members asked to have their names recorded as being in favour of these three motions. Had these three recommendations been passed, they would have been inserted after Recommendation 34 in Chapter 12, as they are pivotal to Recommendations 33 and 34.
Chapter 12, Recommendation 33 in the main Report reads:
That compensation be reinstated for all those producers who choose to de-stock infected flocks and decontaminate their total property or, subject to an approved property disease control plan that provides for OJD eradication being in place, a defined part/s of their property.
Chapter 12, Recommendation 34 in the main Report reads:
"That the levy system be retained and the Government give consideration to increasing the levy rate, in consultation with industry, to reduce the period of debt.
It is the view of the four members of the Committee presenting this Minority Report that the three defeated recommendations should have been included in the main Report for it to become a logical and complete Report.
RATIONALE
The recommendations in the main Report, plus the three failed recommendations, were developed after hearing evidence and reading submissions given to the Committee during the Inquiry.
Throughout the OJD Inquiry, some Committee Members had as a high priority that the Committee's final recommendations must encourage individual sheep owners to support a future OJD program in Victoria. It was clear from the bulk of the evidence that without full industry support, the OJD program cannot succeed.
The overwhelming evidence is that control of OJD should be continued in Victoria. Unfortunately there is no practical alternative to quarantine of individual properties because of the many difficulties with the disease including the lack of a simple and reliable test. Quarantine is also a requirement of the National Program.
In the future, our knowledge of OJD may increase and then Victoria may be able to adopt modifications from both the Wisconson model as suggested by Mr. Don Lawson representing the Australian Beef Association (Ch. 9.15 to 9.18), and the Starritt model devised in 1996 by stud breeders Bruce and Ann Starritt. (Ch. 6.46 to Ch. 6.48). These models are based on management of the disease using a farm grading system without full quarantine and enabling limited trading.
To gain broad industry support, any OJD Program must include compensation if properties are voluntarily de-stocked.. The findings of the Main Report and this Minority Report, heavily modify the present OJD Management Program in Victoria. The recommendations are designed to be in part, a holding operation until the National OJD Review is completed in 2003.
When the OJD Program was introduced to the Victorian industry in 1996, and as identified in this Committee's main Report, very little was known about the spread of the disease in Victoria, or how best to manage it.
It is obvious that there is still a lot unclear about the disease, for example:
_ Are there implications of the OJD and BJD strains jumping species and especially transferring between cattle and sheep, and what are these implications?
_ What does this mean for the future management of the disease and the Control Program?
Between 1996 and November 1999 when compensation was suspended, the Department learnt a great deal about how to manage OJD, as identified in this main Report. Many farmers, however, especially in the early years, suffered great hardship while the Department was developing that expertise.
This expertise is still not perfect because the Committee has had a many submissions that strongly indicate that the Department needs external advice from industry on how to manage the OJD Program as it relates to the commercial realities of farming. A recent example of this is a Department decision, which has threatened the long-term economic viability of a Victorian stud. The Department reversed a decision not to allow trading after the damage was done.
The suffering of farmers from 1996 until today, was in a large part because there was no framework that could give alternate independent advice to the Minister on all aspects of the Program and the effects of the Program on individuals. The Sheep and Goat Compensation
Advisory Committee has limited statutory powers and could not provide a much-needed link between affected farmers and Government or even provide a supporting role to farmers.
We are therefore pleased that the main Report recommends that an independent Industry Committee be established, which, if accepted, would provide the framework for industry to be heavily involved in the next stage until 2003. This is vital if the Program is to succeed.
This new Committee will have a much wider role than the current Sheep and Goat Compensation Advisory Committee.
Integral to the many responsibilities of the new Committee will be its independent advice to the Minister on new scientific knowledge or alternate and improved management proposals as they are developed. It can also assess and advise on interstate trade implications as well as issues peculiar to the stud industry such as the extraordinary example listed earlier in this minority report.
Currently, the main factor preventing the introduction of alternate management systems, is that present testing methods may not readily identify the disease, especially in the early stages.
The main Report identifies that there was broad support for a quarantine and voluntary de-stocking program with compensation, until better testing and related management methods are developed. It recommends that the OJD Compensation Fund be re-instated (Chapter 12, Recommendation 10 and 33).
After assessing all the evidence, it is clear to the above signatories that the burgeoning debt of the OJD Compensation Fund is threatening its viability (table 10.11; and 10.12) It is vital that the OJD Program is not crippled by the OJD Compensation Fund debt.
The only solution is financial support from the Government.
When industry agreed to have a levy imposed to fund the OJD Compensation Scheme in 1996, it did so based on information from the Department of Agriculture. This information was subsequently found to be incorrect. The direct result was that this incorrect information influenced a decision by industry that has eventually created financial problems with the OJD Compensation Fund.
The information given by the Department at the end of 1996 was that there were thirty three (33) infected flocks in Victoria and only a few million dollars would (probably) see the disease eradicated in Victoria. On the best information available, the proposal appeared achievable and encouraged the industry to approve a levy scheme for the OJD Compensation Fund. A program of quarantine and compensation was not being carried out in any other State or overseas
The industry was further encouraged because the State Government offered one million ($1M) seeding money to "kick start' the OJD Compensation and Control Program.
As the Program developed, more and more infected farms were discovered and today there are one hundred and eighty eight (188) farms identified with OJD, including twenty (20) that have not de-stocked. It is understood that the compensation fund for the year 1999-2000 has had an income of one point two eight million dollars ($1.28M) from the levy on the sheep industry. According to evidence given from the Sheep and Goat Compensation Advisory Committee, the fund is now approximately sixteen million dollars ($16M) in debt, with compensation suspended but quarantine still in place.
The present projections, including the possibility of up to one hundred (100) new farms being identified in Victoria with the disease (Prowse Report, March 2000) means that the Industry could eventually owe twenty six million dollars ($26M) to the State Government, assuming compensation is reinstated. This figure is based on a loose average of approximately one hundred thousand dollars ($100K) to compensate each farm. The subsequent debt appears unsustainable and will take many years to pay back..
Tables 10.11 and 10.12 of the Main Report list several scenarios. The most likely scenario under the current program and taking the assumptions of Prowse, (in relation to new property infestations being identified), it will take 89 years to repay the debt. If the levy is doubled, the chart indicates this would reduce to 15 years. In the worst case scenario, the chart identifies that "debt continues to rise indefinitely".
Finding 10.9 of the main report provides an overview of this concern.
Compounding the problem of sustainability, it is understood that the industry is paying interest to the Government on the Treasury advances to the fund. (Ch 10.119)
The writers of this Minority Report believe the Government now has a responsibility to demonstrate its support for continuation of the program. Without the Government publicly demonstrating its belief in continuing the Program, including compensation, the Program will rapidly lose industry support and most certainly fail.
The Committee was told that Victoria will lose the advantage it has created if the Program is cancelled. The Committee was also told that the sacrifice since 1996 of those affected growers who have lost a great deal for the good of the industry and the State of Victoria, would have been made for nothing.
There is no doubt the Program and the state of the OJD Compensation scheme should have been reviewed both by the Department and the previous Government when it was obvious the Program was becoming unsustainable.
There was no evidence that the Government of the day was alerted to the financial problems and the fact that the fund was unsustainable. There is a probability that the issue was played down by industry and the Department for fear that the Government may have scuttled the Program.
In line with Chapter 10.87 and Finding 10.06 (Economic Impacts), we believe the future cost of containment and control now must be shared more evenly across the Victorian community. The industry simply cannot sustain the burden, and evidence has been given that the economic benefits of OJD control will directly assist the Victorian economy.
The evidence for increased Government support for the OJD Compensation Fund can be found in the history of past stock diseases, and outlined in this Committee's main report.
Chapter 5.10 Victoria has successfully undertaken a number of livestock disease control and eradication programs. Examples cited by Dr. B. Kefford, Executive Director Agriculture, Department of Natural Resources and Environment, include contagious bovine pleuropneumonia (eradicated in 1973), bovine tuberculosis and brucellosis (eradicated in 1997 and 1998 respectively, three fowl plague outbreaks and (in 1997) anthrax in the Goulburn Valley.1 However Dr Kefford acknowledged, in his evidence to the Committee, that OJD has been different and more difficult to manage than other diseases2.
5.11 All of these previous control and eradication programs attracted State Government funding as well as funding from the Commonwealth Government and industry.
The details are:
Bovine pleuropneumonia - joint national/industry of operations and compensation.
Bovine TB and brucellosis* - initially joint State/Commonwealth/industry, later State/Federal covered operational costs, industry compensation
Fowl plague - State/Commonwealth operational and compensation
Anthrax* - government (no compensation as death or vaccination)
* human health implication
The exact Government contribution towards control and eradication of the diseases listed above is not known to us but would be significant.
The following additional recommendations should therefore be accepted by the Government as they are the logical consequence following the thrust of the main report. These additional recommendations should be accepted in order that the other recommendations contained within the report succeed.
1. THAT THE STATE GOVERNMENT SUPPORT THE OJD COMPENSATION FUND TO THE EXTENT OF HALF THE PRESENT DEBT.
2. THAT THE STATE GOVERNMENT SUPPORT THE OJD COMPENSATION PROGRAM FROM ITS SUSPENSION DATE IN NOVEMBER 1999, ON A DOLLAR FOR DOLLAR BASIS WITH INDUSTRY, SUBJECT TO REVIEW WHEN THE NATIONAL PROGRAM DECISION IS MADE.
3. THAT THE STATE GOVERNMENT APPLY TO THE FEDERAL GOVERNMENT FOR ASSISTANCE TO SUPPORT THE OJD COMPENSATION FUND.
It is fair and just that the State Government now supports the levy fund. The precedent is there for it to do so. Such support will boost a flagging morale in the industry and ensure a viable 'holding pattern' until the new Committee can assess future management options. This will include the relevant science and especially the results of the 2003 National OJD Review.
Hon. Graeme Stoney, MLC Deputy Chair Mr. Craig Ingram, MP
Mr. Hugh Delahunty, MP Mr. Terry Mulder, MP
25.10.2000
1 Kefford B. (2000), Executive Director Agriculture, Written Submissions, OJD 087
2 Kefford B. (2000), Executive Director Agriculture, Written Submissions, OJD 087
