Sustainable Queensland Dairy Production (Fair Milk Price Logos) Bill 2016

Introduced: 13/10/2016By: Mr S Knuth MPStatus: 2nd reading failed

Regional Queensland Business & Economy Cost of Living

This summary was generated by AI and has not yet been reviewed by a human.

Plain English Summary

Overview

This bill proposed a voluntary 'fair milk price logo' for fresh milk sold in Queensland, showing consumers that the farmer who produced the milk had been paid a fair price set by the government for their region. It was introduced by Katter's Australian Party MP Shane Knuth in response to the decline of Queensland dairy farming following supermarket $1-a-litre milk pricing. The bill failed at second reading and did not become law.

Who it affects

It would have mainly affected Queensland dairy farmers (who would gain a benchmark fair price), milk processors (who could choose to use the logo), and consumers who want to support local dairy farmers at the checkout.

Key changes

Create a separate voluntary fair milk price logo for each of three Queensland dairy regions (Central, North and South East Queensland)
Require the Minister to set and publish a fair milk price per litre for each region at least twice a year, based on production costs plus a sustainable gross margin
Use Queensland Dairy Accounting Scheme data to calculate production costs, with consultation of dairy farmers in each region
Make it an offence (up to 75 penalty units) to sell milk bearing the logo when the farmer was not paid the fair price, or to use a deceptively similar logo
Require the Minister to consult interstate and Commonwealth counterparts about matching logos and report to Parliament twice a year
Bill defeated at second reading - the logo scheme was never implemented

How this affects you

Regional Queensland

•The bill aimed to slow the decline of Queensland dairy farming, where farmer numbers had dropped from about 1,545 in 2000 to around 430 by 2016Explanatory Notes - Reasons for Policy ObjectivesAbout 1,115 Queensland dairy farmers have exited the industry since 2000, with an average of 70 leaving each year.
•Separate logos for Central, North and South East Queensland dairy regions would let shoppers support farmers in their own regionClause 4 and Schedule 1A logo for each Queensland dairy region identifies the region in which the milk was produced.
•The bill flagged that without intervention fresh milk production in Queensland could end by 2028, risking over 3,000 regional jobsExplanatory Notes - Potential Impacts of InactionMore than 3,000 Queensland jobs would be put at risk and the economic loss would amount to approximately $700 million in retail sales.
•The bill was defeated at second reading, so no region-specific logo or fair price was ever establishedStatus: 2nd reading failed.

Business & Economy

•Dairy farmers would have had a government benchmark 'fair milk price' per litre set twice a year for each region, based on production costs plus a sustainable gross marginClauses 5 and 6The fair milk price equals the cost of producing a litre of fresh milk plus the sustainable gross margin, stated in a gazette notice at least twice a year.
•Milk processors could voluntarily use the logo but would have to pay farmers the gazetted fair price for logo-bearing milk, with some adjustments allowed for milk qualityClauses 7 and 8A processor could pay an 'adjusted fair milk price' where the supplied milk's composition or quality justified it under contract.
•Selling milk wrongly bearing the logo, or using a deceptively similar logo, would carry penalties of up to 75 penalty unitsClause 8Maximum penalty - 75 penalty units for advertising, marketing, selling or supplying marked milk that is not fairly priced milk.
•The scheme was designed to be voluntary and market-driven rather than regulating all milk sales, to stay compatible with Commonwealth competition lawExplanatory Notes - Achievement of Policy ObjectivesIn compliance with the Federal Competition and Consumer Act 2010, this Bill does not enable regulation of the Queensland dairy industry.

Cost of Living

•The bill did not set retail milk prices - it set a minimum price paid to the farmer only for milk that processors chose to sell under the logoExplanatory Notes - Achievement of Policy ObjectivesThe minimum price for milk is not applicable to every contractual agreement or sale, but is a necessary component of the eligibility criteria for a fair milk price logo.
•Supporters argued failure to act could eventually push up fresh milk prices in Queensland as supply is freighted in from southern statesExplanatory Notes - Potential Impacts of InactionIf the projected decline continues, consumers will be faced with paying more for fresh milk, which would have to be freighted from southern states.
•Because the bill failed at second reading, no new logo, price signal or pricing mechanism was introduced at the supermarket shelfStatus: 2nd reading failed.

Bill Journey

Introduced13 Oct 2016View Hansard

First Reading13 Oct 2016View Hansard

▸Committee13 Oct 2016View Hansard

Referred to Agriculture and Environment Committee

Agriculture and Environment Committeeportfolio

Committee Inquiry

Report No. 33, 55th Parliament - Sustainable Queensland Dairy Production (Fair Milk Price Logos) Bill 2016(bill)

Committee Findings

Did not recommend passage

The Agriculture and Environment Committee examined the private member's bill and recommended it not be passed. The bill proposed a government-operated fair milk price logo scheme for Queensland dairy products, but the committee concluded a legislated scheme was not the appropriate mechanism. Instead, the committee recommended the Minister direct the Department of Agriculture and Fisheries to investigate supporting the Queensland Dairyfarmers' Organisation to devise and operate an industry-led marketing scheme. The government accepted that recommendation but did not accept the suggestion to consult with other jurisdictions on similar schemes.

Key findings (4)

The committee recommended that the bill not be passed, finding a legislated fair milk price logo scheme was not the appropriate approach.
The committee supported the concept of fair milk pricing but favoured an industry-operated marketing scheme over government legislation.
The government accepted the recommendation to work with the Queensland Dairyfarmers' Organisation on an industry-led scheme.
The government did not accept the recommendation to consult with other state and Commonwealth ministers, noting other jurisdictions' dairy industries are based on manufacturing milk markets rather than drinking milk markets.

Recommendations (3)

The committee recommends that the Sustainable Queensland Dairy Production (Fair Milk Price Logos) Bill 2016 not be passed.
The committee recommends that the Minister for Agriculture and Fisheries direct his department to investigate options for supporting the Queensland Dairyfarmers' Organisation to devise and operate an industry-operated marketing scheme, potentially including fair milk price logos.
The committee recommends that the Minister for Agriculture and Fisheries consult with his counterparts in other states and territories, and with the Commonwealth Minister for Agriculture and Water Resources, regarding the institution of similar schemes in order to increase the sustainability of the Australian dairy industry as a whole.

AI-generated summary — may contain errors

Committee Report9 Aug 2017

Committee report tabled

Second Reading

Referenced Entities

Sectors Affected

Agriculture Food and Beverage Retail

Classified using AGIFT/ANZSIC Australian government standards

Sustainable Queensland Dairy Production (Fair Milk Price Logos) Bill 2016

Plain English Summary

Overview

Who it affects

Key changes

Bill Journey

Referenced Entities

Legislation

Organisations

Programs & Schemes

Places

Roles & Offices

Sectors Affected

Source Documents