News

AWI to retain levy rate control despite proposed regulations

Terry Sim, February 12, 2021

AUSTRALIAN Wool Innovation will retain the ability to have growers vote on a preferred levy rate this year whether or not proposed regulation changes are implemented before the 2021 ballot.

The Department of Agriculture, Water and the Environment has told Sheep Central it is pursuing changes to the WoolPoll regulations — the Wool Services Privatisation (Wool Levy Poll) Regulations 2003 — to require the 2021 ballot paper to list rates of: zero, the current levy rate of 1.5 percent, 1pc, 2pc, and a supplementary rate, if needed, to be proposed by AWI.

“This will provide for AWI to nominate, at its discretion, a fifth supplementary rate to accompany the four other structured levy rate options,” a department spokesperson said.

In WoolPoll 2018, AWI sought a 2pc levy, but this was rejected by growers who voted for 1.5pc. Grower body submissions to last year’s WoolPoll Review sought greater independence from AWI in the WoolPoll process, with survey submitters evenly divided on the issue of AWI determining the levy options put to levy papers every three years. Growers either supported AWI’s role or commented that AWI’s decisions were “self-serving” and favoured the body.

AWI ‘could consult’ to set a supplementary rate

The WoolPoll Review report said AWI, as the industry services body that receives and manages the levy funding, is well-placed to identify circumstances that would require a levy rate outside the initial four options and to propose a suitable rate to address those circumstances.

“For AWI to propose a supplementary rate would draw on the significant expertise available in the company and would also reflect the duties of the AWI board to act in the best interests of levy payers.

“Consistent with current practice, AWI could consult with the WoolPoll Panel in developing a supplementary rate to be included on the ballot paper,” the report said.

A department spokesperson told Sheep Central the WoolPoll Panel is not responsible for determining the levy rates, which will be prescribed in the regulations governing WoolPoll.

AWI decides all levy options if new regulations are not in place

The department has been unable say whether the recommended regulation changes will be made before the 2021 ballot.

“The department is pursuing these amendments well in advance of the 2021 WoolPoll,” a spokesperson said.

The WoolPoll Review report said: “Amending the regulations may be possible in advance of the 2021 WoolPoll; however, it would be open to AWI to adopt this structure of levy rate options should any regulatory changes be delayed.”

Under review recommendations, AWI will be required to present its recommendation of a particular levy rate to growers as a stand-alone document, which could be included in the voting pack.

“This will be the case, irrespective of whether AWI recommends one of the four fixed levy rate options or a fifth supplementary rate,” the report said.

The department spokesperson said AWI is responsible for conducting WoolPoll in accordance with the WoolPoll regulations.

“Under the current regulations, AWI is responsible for deciding on all the levy rate options to be put to levy payers on the ballot paper.”

Allowing the panel to set levy option was ‘less popular’

The review found that establishing a pre-determined set of levy rate options through regulation would address the concerns raised about how the levy rate options are set and this approach would ‘take the heat’ out of setting the proposed levy rates.

The review found that giving the WoolPoll Panel the authority to determine the levy rate options was “a less popular suggestion” and “overcomplicating matters”, and that an approach to structure the levy rates was the preferred option.

“Many noted that expanding the WoolPoll Panel’s role would require particular skills to be targeted among prospective panel members, and for the WoolPoll Panel to devote significantly more time and energy to their duties.

“Both of these factors may limit the pool of potential applicants and may increase costs,” the report said.

“Stakeholders also suggested that this would give more flexibility in theory than it would in practice, as the range of potential levy rates is so narrow. This was not seen as desirable.”

How does an eight-member committee decide a tie?

A department spokesperson said the WoolPoll Terms of Reference set out that the WoolPoll Panel will operate under majority decision making, with one vote per member on the eight member panel. The representatives from AWI and the department will have no voting entitlements on the WoolPoll Panel.

However, when asked how the eight member committee would settle a tied vote on an issue, the spokesperson said:

“The proceedings of the WoolPoll Panel are a matter for the WoolPoll Panel and AWI, consistent with the panel’s publicly available Terms of Reference.”

According to the WoolPoll Terms of Reference the role of the recently selected eight member WoolPoll Panel includes overseeing and developing the WoolPoll communications strategy, approving the Voter Information Kit, approving the poll process, delivering the final report on the operation of WoolPoll to AWI and the department. The role of the WoolPoll Panel chair is to facilitate the respectful and orderly conduct of panel meetings, ensure all WoolPoll Panel members have an equal opportunity to contribute in meetings and report back to the AWI board on feedback and decisions from the panel.

The spokesperson said the department understands that AWI has not yet announced the opening and closing dates for WoolPoll 2021.

The WoolPoll Panel members were announced this week and the panel’s first meeting is believed to be scheduled for February 25.  The terms of reference state the panel’s chair will be elected by the WoolPoll Panel after it is constituted.

Click here to read the WoolPoll Terms of Reference.

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Comments

  1. Jim Gordon, February 14, 2021

    Firstly, I would like the thank The Department of Agriculture’s team, and Minister Littleproud and his team for trying to give the levy payer a choice. It is incredible, in a democratic country in 2021 the levy payer is still locked into a compulsory levy set by Australian Wool Innovation and all payments to go to AWI. Please, the people and the organisations that are able to make change, continue with all the character of a bull ant.
    AWI’s first priority is their own survival, hence their wanting to control the contributions from wool growers. The politics and the self interest of AWI is killing the clear thinking to research that the levy payer actually needs. For our peak body to work, fairly and equitably, the levy payer has to have control of the contributions.

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