Australia to raise agrochemical registration fees

The APVMA has prepared a Cost Recovery Discussion Paper to invite submissions from industry and other interested parties on the development of the authority’s interim cost recovery arrangements for the period 1 July 2012 until 30 June 2015. A fundamental review of the authority’s cost recovery arrangements will be undertaken by the government in parallel with these proposed interim arrangements.

The Australian Pesticides and Veterinary Medicines Authority (APVMA) is one of a number of Australian Government regulators funded by fees, charges and levies imposed on the industry it regulates. Chemical companies pay fees for the APVMA to evaluate registration proposals and a levy based on the wholesale sales of chemical products.

The current APVMA cost recovery arrangements were implemented in July 2005, and reviewed in 2008. In 2010, the then Minister for Agriculture, Fisheries and Forestry, Tony Burke, decided that a 10 per cent increase in fees would be applied from 1 July 2010, pending development of a revised cost recover impact statement.

The government has now decided to undertake a fundamental review of the APVMA’s cost recovery arrangements. This review will be undertaken over the period 2012–14. The review will cover all aspects of the APVMA’s cost recovery arrangements including all relevant design options as well as the current 40/60 (application fee/levy) split.

The APVMA is committed to working with industry and stakeholders to identify interim cost-recovery arrangements that are fair, equitable and transparent—and which provide certainty and sustainability for both industry and the APVMA.

The discussion paper proposes interim cost recovery arrangements for the APVMA. It focuses on ensuring appropriate and sustainable revenue to enable efficient and effective administration of agvet chemical regulation and to minimise risks while the longer-term review is being undertaken.

The discussion paper also provides information on expected efficiencies flowing from the Better Regulation of Agricultural and Veterinary Chemicals reforms (external site), including those undertaken in 2010 and those to be implemented in 2012.

The paper considers resourcing issues associated with a modernising of APVMA’s compliance and enforcement capabilities as well as improved timeframe performance measures. Finally, the discussion paper provides information on the additional ongoing costs associated with the operation of a new Continuation of Approvals and Registration Scheme (resulting from the better regulation reforms) and how they might be incorporated into the APVMA’s operating costs.
Key changes proposed in this discussion paper include:

• Indexation of fees
• Restoring the 40/60 split (application fees return to 40 per cent cost recovery, with a complementary reduction in levy rates).
• Introduction of new arrangements for annual fee(s) to cover post-market costs—compliance and enforcement activities, chemical review and the adverse experience reporting program (with an associated reduction in levy rates).
• Introduction of a fee for the Continuation Scheme
• 100 per cent cost recovery for Category 17 (imaged active constituents)—because they are not directly sold and therefore assessment costs cannot be recovered through the levy.
• The repayment of $2 million for the better regulation reforms (to be repaid in future years).

A cost recovery impact statement (CRIS) that takes into account submissions received to this discussion paper will be developed in March 2012, for consideration by the Minister for Agriculture, Fisheries and Forestry, Senator Joe Ludwig. The CRIS will be developed in line with the Australian Government Cost Recovery Guidelines (external site).

The interim arrangements will apply from 1 July 2012 to 30 June 2015.