Activation of the apple and pear industry EPPR levy

APAL is notifying apple and pear levy payers of an activation to the Emergency Plant Pest Response (EPPR) levy as our industry is required to fund contributions of the Varroa jacobsoni and the Torres Strait Fruit Fly response plans.

APAL has sought agreement from the Minister for Agriculture and Water Resources for the activation of the EPPR levy at the following rates:

Apples: the levy will be set at 0.05 cents/kilogram for fresh domestic, fresh export and zero dollars/tonne for juicing and processing.

Pears: the levy will be set at 0.05 cents/kilogram for fresh domestic, fresh export and zero dollars/tonne for juicing and processing.

Estimates calculated by APAL indicate that it will be necessary for the levy to be set at this positive rate for five years and provided the apple and pear industry has met its funding commitments, it is proposed that the levy be reduced back to zero.

Once confirmation from the Minister is received and acknowledged, an objection period will commence and run until 31 May 2017. During this time, apple and pear levy payers are invited to make any reasonable objection to the introduction of this levy.

For more information or to object to the levy contact APAL Technical Manager Angus Crawford on 03 9329 3511 or acrawford@apal.org.au. Alternatively, contact the departments’ levies area levies.management@agriculture.gov.au.

Questions and answers

-Published 12 April 2017-

Since the announcement of an activation to the Emergency Plant Pest Response (EPPR) levy, there have been some questions from concerned apple and pear industry members. Here are the answers to some of the questions you may have about the levy. Please contact Richelle Zealley cm@apal.org.au or Angus Crawford acrawford@apal.org.au for more information.

What is the Emergency Plant Pest Response Deed (EPPRD)?

APAL is a founding signatory to the EPPRD which was signed 28 October 2004. The EPPRD covers management and funding of responses to emergency incidents – such as the incursion of an exotic pest or disease. It also ensures participation from plant industries in decision making and their contribution towards the costs related to emergency incident responses.

Plant Health Australia is responsible for facilitating the partnership between industry and governments during emergency responses and for maintaining the EPPRD, a formal legally binding document.

In 2009, the apple and pear industry elected to set the Emergency Plant Pest Response (EPPR) levy rate at zero with the intention of it being activated in the event of an emergency incident at a rate determined by government regulation in consultation with industry through APAL.

Who made the decision to introduce the Emergency Plant Pest Response (EPPR) levy?

The apple and pear industry EPPR levy rate was established in August 2009 at a levy payers meeting held in Hobart. It was agreed among industry members that the levy would be set at zero with the intention for it to be activated if a plant pest threat or incursion were to occur.

The alternative option was for the EPPR levy rate to be set at a positive amount to build an industry contingency fund but it was agreed this wouldn’t be necessary, that industry would adhere to the proposed levy when necessary.

Prior to the adoption of the EPPR levy, APAL conducted extensive industry consultation which included articles in Australian Fruitgrower magazine; newspaper advertisements across apple and pear growing regions; and direct mail notifications to all levy payers known to APAL.

Can we use existing R&D Funds to meet commitments?

Unfortunately not, a research and development levy can only be used for R&D purposes and the same applies for marketing, the National Residue Survey (NRS) and Plant Health Australia (PHA).
The exception is that the PHA levy can be used for an Emergency Plant Pest Response (EPPR) because it is collected for biosecurity purposes.

Which other industries are contributing to the Varroa jacobsoni and Torres Strait Fruit Fly response plans?

Response plans such as this involve cost sharing between both state and Commonwealth levels of government and affected industries.

Pollination dependent industries affected by Varroa jacobsoni : Industries affected by Torres Strait Fruit Fly:
  • Almond Board of Australia
  • Avocados Australia
  • Australian Melon Association
  • Cherry Growers of Australia
  • Australian Macadamia Society
  • Grain Producers Australia
  • Australian Honey Bee Industry Council
  • Summerfruit Australia Limited
  • AUSVEG Limited
  • Australian Mango Industry Association
  • Raspberries and Blackberries Australia
  • Strawberries Australia
  • Canned Fruits Industry Council of Australia
  • Australian Banana Growers Council
  • Australian Mango Industry Association
  • Australian Processing Tomato Research Council
  • Australian Table Grape Association
  • Avocados Australia
  • Canned Fruit Industry Council Australia
  • Cherry Growers Australia
  • Citrus Australia
  • Summerfruit Australia
  • Wine Grape Growers of Australia

How are these industries contributing their share?

It is up to each individual industry to determine how they pay their share. For example, they may have made a decision to initially set their Emergency Plant Pest Response (EPPR) levy at a positive rate to build up a contingency fund in case of a circumstance such as this.
However, at the time of adopting the EPPR levy, the apple and pear industry made the decision to set the rate at zero and in the case of an industry threat the levy would be activated.

As this is a cross-industry issue why can’t we use Pool2 funding to meet our commitments?

Pool 2 funding has been developed for strategic, long term investments, not for addressing an emergency response – which is the reason the Emergency Plant Pest Response Deed (EPPRD) was created, so government and industry would share the costs to fund a response.
Pool 2 funding offers an opportunity for the entire horticulture industry to invest in cross industry R&D projects. And while there are Pool 2 funds set up for Pollination and Fruit Fly, they have specific, long-term projects to deliver on.

What happens if the apple and pear industry doesn’t contribute to the Emergency Plant Pest Response (EPPR) levy?

Under the Emergency Plant Pest Response Deed (EPPRD), APAL is the signatory and therefore liable to pay the apple and pear industry’s share in funding a response. If we do not pay our share of the levy, APAL will be indebted to the Commonwealth Government.

In 2009, the apple and pear industry elected to set the EPPR levy rate at zero with the intention of it being activated in the event of an emergency incident at a rate determined by government regulation in consultation with industry through APAL.

There has been no need to activate the levy until the initial detection of Varroa Jacobsoni was recorded.

Who decided to implement the Varroa jacobsoni and Torres Strait Fruit Fly response plans?

A collective agreement was made between affected horticulture industries and the Australian Government’s National Management Group to proceed with an immediate response plan as it was deemed technically feasible to do so to stop an incursion of Varroa jacobsoni and Torres Strait Fruit Fly.

How does APAL decide the levy needs to be activated?

There has been no need to activate the apple and pear industry levy until the initial detection of Varroa jacobsoni was recorded.

In June 2016 APAL paid the apple and pear industry’s share of $15,690.70 for the Torres Strait Fruit Fly response plan. Rather than raise the Emergency Plant Pest Response (EPPR) levy it was decided to use APAL’s own funds in this instance where in the future some of this would be covered by the surplus Plant Health Australia levy.  However, since then with the detection of Varroa jacobsoni the apple and pear industry’s contribution has greatly increased and has resulted in raising the levy from zero to 0.05 cents/kilogram for fresh domestic and fresh export apples and pears.

What is the process for levy activation?

The process for Emergency Plant Pest Response (EPPR) levy activation flow chart can be found on the Department of Agriculture and Water Resources Biosecurity Levies website.

In 2015 this processes for activating an EPPR levy was streamlined. The key change was that industry consultation, which involved a 3-6 month consultation process followed by an industry ballot, is that it is replaced by a public notification and objection period. This change acknowledges that industries supported this levy and its intention to be activated when required. These streamlined requirements only apply to activating EPPR levies, not research and development or marketing levies.

What would a Varroa jacobsoni and Torres Strait Fruit Fly incursion mean to the Australian horticulture industry?

Any plant or pest threat incursion could be detrimental to the Australian horticulture industry which is why it’s important to have strict biosecurity measures in place and that the apple and pear industry responds accordingly.

For more information as to what the introduction of Varroa jacobsoni might mean to the Austrailian horticulture and bee keeping industries, read Angus Crawford’s article: Australia steps up to eradicate bee-destroying mite.

How much will this cost apple and pear growers?

To provide an estimate on what this will cost a grower, information has been combined information from the 2015-16 levy statistics and the 2017 Apple and Pear crop forecast. The levy statistics provide the total number of kilograms which were levied for the year 2015-16 for apples and pears for domestic and export markets which is 276,159,185 kilograms. The crop forecast provides the average class 1 production per hectare for apples and pears which is 20.174 tonnes per hectare (rounded to 20 tonnes).

Therefore, a grower on 10 hectares producing 200 tonnes of class 1 apples and pears per year will be paying $100 extra per year or $500 total over the five year period.

What will these response plans cost the apple and pear industry?

The following table describes the levels of funding the Emergency Plant Pest Response (EPPR) levy will likely raise against the expected amount required year by year. The subsequent surplus/deficits are also presented. Based on the table the EPPR levy will have covered the immediate needs of the industry by Year 4. However, an additional year will ensure the industry is in a stronger position to fund its share of likely further contributions to the eradication of Torres Strait Fruit Fly.

While the Torres Strait Fruit Fly response plan has an end date, it is likely to remain an ongoing commitment. This is due to the nature of the incursion as each year these exotic fruit flies are wind-blown southwards from Papua New Guinea to the Torres Strait Islands where they are subsequently eradicated.

Year 1 Year 2 Year 3 Year 4 Year 5
EPPR Levy Raised $138,080 $138,080 $138,080 $138,080 $138,080
Total required $321,948 $122,580 $42,655 $27,000 $27,000
Yearly Surplus/Deficit -$183,868 $15,500 $95,425 $111,080 $111,080
Accumulated Surplus/Deficit -$183,868 -$168,369 -$72,944 $38,135 $149,215*

Table: based on levy statistics collected in 2015-16 the expected amounts raised will be a total of $690,398.

*It is expected the surplus will fund further contributions to the Torres Strait Fruit Fly response plans for an additional five years once the levy rate is reviewed and potentially reset back to zero.

These estimates suggest it will be necessary for the EPPR levy to be set at this positive rate for five years and providing all funding commitments are met, it’s proposed the levy will again be reduced to zero.

More information

Apple and pear industry levy information

Activation of the apple and pear industry EPPR levy, March 2017

Australia steps up to eradicate bee-destroying mite, December 2016

Preparing for Varroa destructor, December 2016

Bee-destroying mite found in Queensland, July 2016

Levy may rise to address exotic fruit fly, December 2015

APAL welcomes changes to an emergency incursion, October 2015

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By |March 31st, 2017|Biosecurity, News|

About the Author:

APAL is an industry representative body and non-profit membership organisation that supports Australia’s commercial apple and pear growers.