minutes meeting 5

Minutes Meeting 5

Wednesday 21 April 2010
10:00am - 1:30pm
AQIS Canberra Office

Attendees:

Lee Cale, AQIS - Chair
Quentin Wallace, International Racehorse Transport
Chris Burke, International Racehorse Transport
Crispin Bennett, Crispin Bennett International Horse Transport
Josh Murphy, New Zealand Bloodstock
Roger Lavelle, Australian Horse Industry Council
Franz Venhaus, Equestrian Australia
Grant Baldock, Equestrian Australia
Paul O’Callaghan, Racing Victoria Limited
Peter McGauran, Thoroughbred Breeders Australia
Andrew Kelly, Harness Racing Australia
Kevin Doyle, Australian Veterinary Association
Peter Shergold, University of New South Wales
Jill Millan, Biosecurity Australia
Phillip Widders, AQIS – NSW
Helen Walker, AQIS – Horse Imports
Emma Haslam, AQIS – Horse Imports
Murli Baker-Gabb, AQIS – Horse Imports
Scott Channing, AQIS – Animal Quarantine
Stacey Collins, AQIS – Animal Quarantine
Peter Moore, AQIS – Quarantine Operations
Greg Fullam, AQIS – Quarantine Operations
Louise Sharp, Biosecurity Australia
Jemma Martin, DAFF – Biosecurity Secretariat (Observer)

Apologies:

Patricia Ellis, Australian Horse Industry Council
John Peatfield, Thoroughbred Breeders Australia
Robyn Martin, Biosecurity Australia

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1. Welcome and Introductions

The new Chair of the Horse Industry Consultative Committee (HICC) welcomed members to the fifth meeting, and in particular Professor Peter Shergold. The Chair gave a brief outline of her background and advised that she was looking forward to working with horse industry stakeholders through the HICC.

The Chair noted apologies from Patricia Ellis, John Peatfield and Robyn Martin.

2. Meeting 4 Minutes and Action Items

The Chair called for any further comments on the minutes from the fourth HICC meeting. The minutes from the fourth HICC meeting were accepted. The Chair discussed each of the action items arising from the third meeting and advised that most of the items had been completed and many would be discussed as agenda items later in the meeting.

Horse importers advised that they were still having difficulty with Hong Kong authorities recognising Australia’s equine influenza free status (Meeting 4 - Action Item f). Biosecurity Australia (BA) confirmed that it had received correspondence acknowledging EI freedom and Hong Kong was currently reviewing horse import conditions for all countries.

3. AQIS Horse Imports Program Finances

The Chair outlined the Horse Imports Program current financial position noting that Program expenditure was tracking in-line with budget however revenue was below budget estimates despite a rise in quarantine fees in December 2009. The Chair provided a brief overview of the discussion at the HICC Finance Sub-committee (FSC) meeting held at the beginning of April, including: a request for AQIS to provide more detailed financial reports; AQIS agreeing to liaise with the FSC in relation to the 2010/11 Horse Imports Program budget; and the provision of quarterly financial reports to the HICC members.

AQIS confirmed that with the suspension of horse imports into Spotswood Quarantine Station, the full costs of the station were being attributed to the Post Entry Animal Quarantine Program comprising largely of cat and dog imports. Further, HICC members were advised that the Department’s corporate finance area had notified cost-recovery programs that they would be required to undertake fee reviews sometime during the 2010/11 financial year. Equine Australia commented that any future fee structure should consider whether day-by-day charge rates should be applied to post-arrival quarantine regardless of whether consignments are co-mingled or not, or whether there should be a standard charge for both 14 and 21 day post arrival quarantine.

HICC members continued to express concerns about the long term sustainability of the horse imports and pointed to the obvious downward spiral in horse numbers. Members agreed that the Government needed to reconsider the current approach of applying full cost-recovery principles to the Horse Imports Program. The Chair noted members concerns and advised that the issue of cost-recovery was addressed in the Beale Review, and that it was an issue being considered from a whole of Biosecurity Services Group perspective.

Horse importers noted that there was a misperception that thoroughbreds made up the majority of horses imported into Australia. In reality, thoroughbreds as a proportion of total horse imports were diminishing, and other breeds now constitute the majority of horses imported. Despite the higher quarantine fees, the Australian Horse Industry Council noted that there were still horse enthusiasts who were likely to continue to import high performance horses. Equestrian Australia mentioned that the higher quarantine fees were significantly affecting the ability of Australians to compete internationally, and that many competitors were forced to sell their horses overseas rather than bring them back to Australia.

Finally, importers advised that the stronger Australian dollar relative to the United States Greenback and English Pound may be masking the true impact of the quarantine fees, as a number of people were purchasing horses as a result of the favourable exchange rate. Importers warned that if the Australian dollar falls there would likely be a sharp fall in horse imports.

Action:

1. AQIS Horse Imports Program to raise the issue of financial sustainability with senior executive and liaise with other cost-recovered programs facing financial pressure

4. Suspension of Horse Imports into Spotswood Quarantine Station

The Chair summarised the outcome from the previous HICC meeting in October 2009, noting the decision to temporarily suspend horse imports into Spotswood Quarantine Station was made on economic grounds aimed at keeping horse quarantine fees to a minimum. The Chair advised that should a decision be made to reinstate horse imports into Spotswood Quarantine Station, upgrades would need to be completed to address animal welfare concerns. Initial cost estimates for the upgrades were approximately $312,000 however the actual figure could be significantly higher.

AQIS also advised HICC members that it would be undertaking a comprehensive rent review of all government quarantine facilities as part of the Future Post-entry Quarantine Arrangements project. With the leases at both Spotswood and Eastern Creek quarantine station up for renewal at the end of 2010, HICC members indicated that Spotswood might prove to be more cost effective for horse imports.

Some members also queried the availability of Racing Victoria Limited’s (RVL) future quarantine facility at Werribee. RVL noted that in the past non-thoroughbred horses had used its quarantine facilities, however, at this stage the RVL Board had not made a decision on the use of the Werribee facility for non-thoroughbred horses.

HICC members agreed to defer the decision on the suspension of horse imports into Spotswood Quarantine Station until the October meeting, once further information is available on the lease conditions and costs across all government quarantine stations.

5. Future Post-Arrival Quarantine Arrangements

The Chair introduced Peter Moore and Greg Fullam from the AQIS Quarantine Operations Division who provided an update on advice being developed for Government on future post-entry quarantine arrangements. AQIS advised the HICC Committee that the Government was reviewing options for post-entry quarantine arrangements for all animal and plants species in line with the recommendations of the Beale Review and Callinan Inquiry. The Government currently operates five quarantine stations, all of which have leases expiring at various times over the next five years.

AQIS will be working closely with the Department of Finance and Deregulation. The Two Pass process mandated by Government means that all options must be considered, including government owned and operated sites, leased arrangements, public/private partnerships and full privatisation. In considering options, biosecurity requirements will be the paramount consideration. AQIS will be undertaking detailed consultations with industry groups and stakeholders to consider each importing industry’s requirements. It is expected that consultations with industry, via a series of workshops, will commence in July 2010 and that advice will be provided for Government consideration in early 2011.

The process for considering future quarantine arrangements has been mandated by the Government and ensures Government will receive full and independent advice on all aspects of the project, including technical and financial matters. AQIS will be seeking information from industry during the consultations that will be important in developing the business case. HICC members were invited to contact Greg Fullam, Project Manager if they had any queries regarding the project. HICC members were also invited to advise Greg Fullam whether the technical experts engaged to develop the business case should visit private or overseas horse quarantine facilities.

6. Charging Arrangements for PEQ Facility Inspections

AQIS advised members that one of the recommendations of the Equine Influenza Inquiry was that horse pre-export quarantine (PEQ) facilities needed to be approved by AQIS before they could be used to import horses to Australia. AQIS has developed an approval process that requires PEQ facilities and associated manuals to be inspected and reviewed by AQIS. Existing approved PEQ facilities will need to be re-inspected and approval renewed by AQIS at regular intervals.

AQIS noted that at the HICC meeting in October 2009, members considered cost-recovery options relating to PEQ inspection. Since the October meeting, AQIS had sought legal advice and has been advised that the most efficient and effective mechanism for recovering PEQ inspection costs was through a formal contract between relevant parties. Members were advised of the discussions at the HICC Finance Sub-committee meeting whereby importers indicated that it was likely that AQIS would need to establish contracts with importers, PEQ facilities and possibly other parties such as RVL. Further, the main issue for importers related to the legal liabilities that may be associated with such contracts. AQIS agreed to seek further advice on legal liability issues and liaise further with importers.

Action:

1. AQIS to seek further legal advice on potential legal liabilities associated with the PEQ inspection contracts.

Some HICC members queried the Japanese PEQ facilities that were being proposed and whether the 200 metre exclusion zone applied. AQIS informed members that the 200 metre exclusion zone only applied to horses from the United Arab Emirates, and that this was indicated in the Model PEQ standard operating procedures (SOP) developed by AQIS.

Action:

2. AQIS to provide a copy of the Model SOP to IRT.

Importers noted that the initial inspections of Japanese PEQ facilities should be relatively straightforward, however follow-up inspections and associated cost recovery arrangements will be more difficult. Biosecurity Australia (BA) advised that Japanese authorities had indicated that four PEQs were likely to apply for approval. BA also mentioned that they were continuing to develop import conditions for horses that will be discussed with each overseas country.

Members also queried how long it would take for AQIS to approve PEQ facilities from Japan. The Chair informed members that AQIS had undertaken to assess all Japan PEQ SOP manuals in four weeks. At such time that the SOP manuals were approved, AQIS would need to send a veterinary officer to Japan to conduct a site inspection of the PEQ facilities.

Action:

1. BA to notify importers when letters are sent to overseas authorities informing them of the revised import conditions.

7. Horse Crush and Veterinary/Surgical Facilities at Eastern Creek Quarantine Station

AQIS advised members that a definitive outcome on a horse crush had not yet been reached, and that AQIS will continue to liaise and seek the advice of relevant veterinarians over the coming weeks to resolve the matter.

Action:

2. AQIS to provide a paper to HICC members out-of-session on the proposed specifications of a horse crush at Eastern Creek Quarantine Station

In relation to equine veterinary and surgical facilities, AQIS was awaiting advice from the private veterinarians nominated by importers on what might be needed at Eastern Creek Quarantine Station. AQIS will seek agreement from relevant parties on the equipment to be purchased once the advice from the veterinarians is available. AQIS reiterated that the cost of any veterinary/surgical equipment would be paid by AQIS and socialised across all horse imports.

8. Quarantine Approved Premises for Imported Horses

AQIS informed HICC members that following completion of the Import Risk Analysis for Horse Imports, criteria are being developed for private quarantine approved premises (QAPs), for example the Werribee International Horse Centre and future premises to be used for quarantine surveillance. AQIS advised members that the Quarantine Act 1908 provides the legal basis for establishing QAPs and that many other animal and plant imports currently operate under QAP arrangements where deemed appropriate by AQIS.

The implementation of QAP arrangements will strengthen current quarantine surveillance processes. AQIS informed members that the initial focus for QAPs will be on pregnant mares. AQIS advised that the revised arrangements will make the importation process for pregnant mares more complex, and that there would be costs associated with inspecting and approving QAPs. At this stage AQIS is unable to provide an indication of the possible costs for establishing a QAP.

9. Biosecurity Australia Update

Biosecurity Australia (BA) advised HICC members that it was currently writing to overseas authorities in relation to the new import conditions, following completion of the import risk analysis for horse imports.

Since the previous HICC meeting in October 2009, BA had followed up with authorities in Hong Kong confirming Australia’s equine influenza status. The Hong Kong government had written to BA indicating that they recognised Australia's equine influenza status and are currently reviewing all horse import protocols, including from Australia. However, importers advised that there still appeared to issues with Hong Kong authorities concerning Australia’s equine influenza status.

BA informed HICC members that certification issues for the export of horses to Thailand remain unresolved. Through the Australian Embassy in Bangkok, BA has attempted to obtain a response to a letter sent in December 2009 detailing these issues.

10. Equine Influenza Implementation

The Chair provided HICC members with a brief overview of progress that has been achieved in implementing the Government’s response to the Equine Influenza Inquiry recommendations. Overall, 33 recommendations have been completed and two remain outstanding, one relating to upgrades at the government quarantine stations and the other is a biannual review of the IRA for horse imports, which is not scheduled to take place until 2012. Three recommendations have been superseded by the Beale Review of Quarantine and Biosecurity Arrangements. These include the appointment and removal of the Inspector General of Horse Quarantine and the powers of quarantine staff under the Quarantine Act 1908.

The Chair also advised HICC members that although the Interim Inspector General of Horse Importation, Dr Kevin Dunn, has now become the Interim Inspector General of Biosecurity, he would continue to have oversight of horse quarantine arrangements. In fact, he had recently completed an audit of health certificates for imported thoroughbred stallions. AQIS informed members that the future workplan of the Interim Inspector General of Biosecurity would be guided by a determination of associated risk.

11. Professor Shergold

Professor Shergold thanked HICC members for the opportunity to attend the meeting. He advised members that his next report to the Minister, due in late June 2010, will be his last. Professor Shergold further noted that the implementation of the Equine Influenza Inquiry recommendations, and therefore his oversight role, was being conducted around much broader horse biosecurity issues. He suggested that there are four significant issues:

1. failure by the Parliament to pass legislation for a horse industry levy mechanism to deal with emergency responses to disease outbreaks
2. equine influenza vaccination, which is related to the emergency response levy issue
3. the impact of increased quarantine costs on horse imports, noting that since AQIS developed a separate budget for horse imports, it has become apparent the extent to which they had been cross-subsidised in the past (pre-Callinan)
4. the future of post-arrival quarantine arrangements.

Professor Shergold suggested that in terms of the increasing quarantine costs, the horse industry had an important role to play in trying to quantify the economic and genetic benefits that Australia derives from horse imports and exports.

Finally, Professor Shergold noted industry concerns with the revised biosecurity arrangements and added that one of the difficulties of Royal Commissions is that they tend to have narrow terms of reference and therefore very specific recommendations. It is a question for Government, when looking at the whole spectrum of biosecurity risks, to decide whether the right balance has been achieved.

Professor Shergold invited members to provide him with written submissions to be considered in preparing his final report. Any submissions should be sent to Jemma Martin, a/g Manager, Biosecurity Secretariat.

Next Meeting

It was suggested that the next meeting be held on either Wednesday 21 or 28 October 2010 in the Sydney AQIS Office.