Import Health Standard Funding and Management - Summary of Submissions

12 January 2006

I Background

The Ministry of Agriculture and Forestry (MAF) released the Import Health Standard Funding and Management discussion document in April 2005. The discussion document has been prepared to outline proposed areas for change to the system of developing import health standards, and to invite comment from stakeholders.

The proposals include a system for prioritising requests for import health standards (IHS’s) and risk analyses for imports, and for funding this work. Each year MAF would collate a list of requests and prepare a draft programme of work by prioritising the list against defined risk management criteria. Relevant industry and government stakeholders would be consulted, and then the work programme would be finalised as appropriate, and recommended to the Minister for Biosecurity for approval.

IHS work would justify Crown funding if it has sufficient public good benefit, otherwise the applicants would have to fully fund the work themselves.

II Submissions

Submissions were received from fifteen organisations. Despite the extent of the changes in the proposed funding and management system, there were a relatively small number of submissions. This may reflect the complexity of the proposed system.

III General Comments

Submissions varied in their support for the proposed changes; however, several common themes could be identified.

  • There was general support for some form of change to the import health standard funding and management system, provided an appropriate level of biosecurity protection was still the priority of the IHS system.
  • Some form of cost sharing was supported by almost all submissions, but there were concerns raised about the proposed system.
  • Several submissions expressed concerns about the impact of the public good test and prioritisation criteria on small and emerging industries.
  • Clear and transparent processes were identified as essential to give applicants more certainty about when their work will be completed, to ensure appropriate decisions on funding and prioritisation, and to prevent applicants from getting around the system by applying pressure on MAF staff.

IV Comments on the different aspects of the proposed system

Comments on the proposed system varied, and it is not always possible to find common themes in the submissions. This section summarises the comments and identifies areas of similarities or differences in the responses.

  • Risk Analysis and IHS Development
    • Concern was expressed about the number of biosecurity breaches. It suggested a greater ability for industry to initiate changes to IHS’s where the level of risk changes to prevent breaches.
    • Some support was given for a review of risk analysis processes and methodology, with public consultation. Risk analyses should be timely, professional and cost effective.
    • Concern was expressed that risk analyses should be more consistent, to address the problem of hitchhiker incursions from imports that are normally unrelated to the pest or disease.
  • Control of IHS Development
    • All of the submissions that commented on control of IHS development supported MAF retaining ultimate control of IHS work to ensure that IHS’s provide appropriate biosecurity protection. Trade pressures and private funding should not be allowed to affect the level of protection.
  • IHS Development Capability
    • One submission noted that MAF’s resources are a constraint on IHS development. It considered that past outsourcing of risk analysis work had not had convincing results, and questioned the effectiveness of further outsourcing. The submission emphasised the need for MAF to take responsibility for developing a pool of skilled external consultants, and suggested MAF might share the costs of training with applicants. They requested further detail on how outsourcing would work.
    • Another submission supported external consultants as a way for MAF to widen the pool of specialists, to cope with its own staff turnover, and to introduce more cost-effectiveness. It supported private funding for external work (overseen and reviewed by MAF), with MAF continuing to do Crown funded work. They did not consider that simply charging for the time of MAF staff would increase scrutiny and accountability.
    • A third submission suggested that it should be optional for applicants to pay for their own risk assessments. The cost of any further MAF work on the risk analysis could be shared with the applicant. The submission considered that this would be a good way to utilise the knowledge and expertise of applicants. MAF would need to give greater information on risk analysis needs and consultation requirements, in the same way that the Agricultural Compounds and Veterinary Medicines involve applicants.
  • Industry Levies
    • Only one submission addressed the issue of using industry levies to pay for IHS work in the future. It opposed the use of levies, and would prefer private funding. They consider that the levies may not meet the Biosecurity Act 1993 requirements of equity and efficiency if the benefits are not widespread, and because a levy system may be inefficient.
  • Prioritisation
    • It was suggested by one submission that where an application was not included in the proposed years work programme, there was no certainty for the applicant as to when they were likely to have their work completed.
    • A number of submissions had concerns about the proposed prioritisation criteria, and considered them too broad and subjective. This was suggested as giving applicants little certainty about how their application would be prioritised.
    • The subjective nature of the criteria was also suggested as making the process highly contestable, which may benefit influential applicants and encourage them to pressure MAF staff.
    • Several submissions suggested that the criteria should be refined to give more certainty. It was also suggested that each application’s prioritisation should be documented to give transparency to the process, and prevent needless disputes of the prioritisation.
    • Individual submissions suggested that some of the criteria were inappropriate. Concerns included spiritual and cultural values, and public acceptability. It was suggested that criteria should not be used to reconsider issues that had been addressed elsewhere, such as granting permission for genetically modified organisms.
    • A number of submissions expressed concern about how the criteria would affect smaller industries. They considered that the prioritisation criteria should reflect the wide and long-term benefit to the economy from developing industries, rather than simply the immediate benefits of using an IHS. Less frequent IHS’s from developing industries or non-profit organisations may also be disadvantaged under the prioritisation criteria because it is less certain to be successful. One submission suggested that MAF prioritised large and small industries separately. Further consideration of this issue was requested before any system was implemented.
    • One submission suggested that a MAF establish a high-level advisory council of government and industry stakeholders to consult further on the procedures for developing IHS's.
  • Funding
    • Some form of cost sharing was supported by almost all submissions. However, there was not clear support for the proposed system. Some submitters felt that the Crown should remain the major source of funding, while others expressed concern about the proposed method of funding.
    • Two submissions opposed a system which required private funding for development of IHS’s that could be used by other importers at no cost (a free-rider problem). Suggested options were exclusive use of the IHS with associated property rights, and Crown funding for all applications that were of general use.
    • Several submissions felt that the public good basis for determining which applications will be Crown funded and which must be self-funded was unclear. Several submissions also recommended that the funding decision for individual applications be explained or documented.
    • One submission supported self-funding, but felt that if there was so much demand that MAF had to prioritise these applicants, there would be no advantage from self-funding.
    • Several submissions were concerned that smaller industries were unlikely to receive Crown funding under a public good test, along with being low priorities. They considered that this might leave them disadvantaged under both the funding and the prioritisation parts of the process. It was suggested that the public good test take a wide, whole of New Zealand view of the public good, including innovation.
    • Two submissions emphasised the need for the funding process to be transparent, consistent and fully accountable. The criteria for deciding which applications must be self-funded should be clear, and equitably applied.
    • Several submissions addressed the method of cost recovery. One stated that private funding should be treated in a professional and business-like manner, with only actual costs charged. This would include timelines, invoicing and reporting to the applicant, as in other commercial arrangements. Clear performance guidelines would be needed for all IHS work.
    • Several submissions considered that self-funded IHS work should be optional for applicants, regardless of whether the work was performed by MAF or outsourced. This would work as a method of ‘fast-tracking’ applications. One submission stated that it was undesirable to have mandatory self-funding for applicants, as it left those that could not pay unable to have their requested IHS work done.
    • One submission recommended that all reviews of existing IHS’s should be Crown funded.
    • It was suggested in one submission that cost-recovery may violate New Zealand’s international trade obligations.
  • The submissions contained a range of other comments on the funding and management system and related issues. Issues raised included:
    • A question on whether 40% of staff time is needed for urgent work, and suggestion that this amount of urgent work should decrease if the system is working correctly.
    • The suggestion that regular feedback on development will reduce applicant frustration. Updates on the MAF website were suggested.
    • A recommendation for closer cooperation with Australia to reduce duplication of work.
    • The suggestion that regularly low prioritisation of an industry can lead to increased risk of illegal importation.
    • The suggestion that in certain circumstances there should be an option of allowing IHS work to be confidential, without open consultation.
    • A recommendation that IHS reviews are minimised by identifying low risk areas and reviewing them only when new risks arise.

VI Conclusion

MAF will consider submissions while further considering implementing a new funding and management system for IHS’s. MAF aims to introduce a new system for the year beginning 1 July 2006.

Page last updated: 30 April 2008