Questions and Answers
What is the objective of dairy reform?
Dairy organisational reform is an important commitment of the Australian Dairy Plan and its objective of supporting a more profitable, confident and united industry. The Dairy Reform process has involved comprehensive industry engagement on a proposed new single, whole of industry national dairy organisation supporting industry services including policy, advocacy, research and development (R&D) and marketing. This reform aims to deliver a stronger and more unified industry voice with an ability to champion common issues as well as represent diverse views across the dairy supply chain. It also works to strengthen advocacy and streamline execution of whole-of-industry strategic priorities.
Who has supported the dairy reform process?
Over the past 12 months the Organisational Reform Steering Committee responsible for reform, has been working towards a viable option to achieve a stronger dairying future. This committee comprises representatives from Australian Dairy Farmers, Australian Dairy Products Federation and Dairy Australia. The committee was supported with external design expertise provided by consultants Ernst & Young, while industry engagement was led by former Meat & Livestock Australia Managing Director David Palmer.
What models have been explored through the reform process?
There has been a focus on developing and testing a model proposed by the Joint Transition Team, known as NewCo B. Central to the NewCo B model was an amalgamation of three national bodies (Australian Dairy Farmers, Australian Dairy Products Federation and Dairy Australia), the broadening of the use of the service levy and the introduction of a processor levy. The Organisational Reform Steering Committee (ORSC) worked hard to achieve a workable version of the NewCo B model but resolved to cease pursuing this approach.
Why was a decision taken not to proceed with creating a single, whole of industry body?
The proposal to create a single, whole of industry body was always considered to be ambitious. After extensive consultation, it was clear that restrictions prevent the use of levies for agri-political activity and that an all-in-one industry model is unable to address the priority of a stronger and more unified industry voice, as it cannot accommodate the requirement for independent representation. It would also compromise government investment in research, development and extension. Other models that combine advocacy with levy funded industry services cannot progress at this time for the same reasons.
What is the progress with reform and next steps?
Going forward the three reform partner organisations - Australian Dairy Farmers, Australian Dairy Products Federation and Dairy Australia - have been given primary responsibility for driving through different aspects of the reform sought by people across the industry.
Australian Dairy Farmers
Australian Dairy Farmers will lead a working group comprising the six state dairy farming organisations to consider how to optimise policy and advocacy development at a national and state level, together with funding arrangements. Former Meat & Livestock Australia Managing Director David Palmer will continue to provide support in this area.
Dairy Australia will commit to greater resourcing for strategic policy development and enhanced transparency for research, development and extension (RD&E) priority setting.
Australian Dairy Products Federation
Australian Dairy Products Federation will facilitate and promote opportunities for collaboration and co-investment by processors on whole of supply chain interests.
What is the cost of the dairy reform process to date?
The initial design and consultation phase of the dairy reform work has cost $700,000. This cost is consistent with the complexity of the reform and extent of supporting activities being undertaken to achieve the change desired by industry.
Is Ernst & Young still providing support to the dairy reform process?
Ernst & Young provided external support to the reform process which helped inform key decisions. They are not currently involved in the project but may be engaged for future tasks.
Will there be consultation on alternative options for industry reform?
Yes. The reform partner organisations remain committed to industry consultation once a viable alternative pathway to reform is prepared for consideration.
How will I receive future updates on the dairy reform process?
Updates on the reform process will be included in future half yearly progress updates on the implementation of key Australian Dairy Plan initiatives.