ANZFA disappointed that food industry body continues to oppose new food labelling

The Australia New Zealand Food Authority has questioned an industry commissioned study which was reported in the media today that claimed proposed new food labelling improvements could cost manufacturers up to $400 million.

'I am disappointed that the Australian Food and Grocery Council (AFGC) continues to oppose proposed food labelling changes that will provide consumers with essential information about nutrition, allergens and the percentage of key ingredients in nearly all packaged foods,' Mr Ian Lindenmayer ANZFA's Managing Director said.

'The proposed Australia New Zealand Food Standards Code, which will be considered by Health Ministers on 24 November 2000 is based on sound science and is the culmination of six years' consultation. Regulatory impact statements were prepared for each individual food standard as well as the proposed joint Code in its entirety.

'Consumers have strongly pressed ANZFA throughout this process for better information so that they can make informed and healthier choices about the food they buy and consumers have strongly supported the new labelling proposals. Indeed, some groups would like even more information than we are currently proposing.

'Industry has also consistently advised us that they routinely make changes to their food labels. For example, they often redesign the labels for promotional purposes and also have to reprint them at regular intervals when stocks run out. After extensive discussion with industry, ANZFA is recommending a two-year transition to give businesses ample time to make label changes without the cost of discarding stocks of labels and packaging.

Cost studies are only as good as the assumptions they are based on and this one appears to have ignored the huge benefits to industry of proposed changes which will eliminate most of the old prescriptive regulations which imposed costs on industry without benefiting consumers.

'The AFGC's claim that it would cost industry up to $400 million is a worst case scenario. ANZFA is of the view that the two year implementation period proposed for the new labelling provisions will allow industry to make the required changes at a convenient time when they would normally be making their next labelling change. Industry has already advised us that they could make these changes at minimal marginal costs if they could be done during a routine reprint.

'Similar claims about the cost of labelling of genetically modified food were made during that debate. The first crude estimate from KPMG was $A3bn for the first year cost of tracking and labelling GM food, based on worst case assumptions. A later more detailed study based on more realistic assumptions greatly reduced this cost to $A106m in compliance costs and $A209m in additional ingredient costs. And most of that was the cost of finding out whether food ingredients contained altered DNA or protein, rather than changing the labels.

'Overseas experience supports ANZFA's view that costs of these labelling changes will be small. For example, bilingual food labelling in Canada, which faced similar industry objections, was introduced smoothly with no appreciable impact on the cost of food. The introduction of percentage labelling in the European Community (EC) countries in February 2000 also went smoothly despite the EC percentage labelling requirements being more stringent than those proposed for Australia and New Zealand. The United States already has more demanding requirements for nutrition labelling and Canada has also recently announced even stronger requirements will be introduced.

'I find it difficult to believe that businesses would find it complex to list the percentage of key ingredients in their products, for example the meat in a meat pie or the strawberries in strawberry jam. They have to know their own recipe in order to manufacture the food - it does not take much effort then to show the percentage of the key ingredient on the label.

'We have also recommended that industry be given flexibility to avoid the cost of batch differences and seasonal variations, by just showing on the label that the product contains at least a stated minimum percentage of the key ingredient.

'The proposed joint Food Standards Code benefits industry by allowing food businesses unprecedented flexibility in their recipes and reducing other regulatory burdens. It is only fair that consumers also get some benefits through labelling that allows them better information on what is in their food,' Mr Lindenmayer said.

Details of the proposed new labels are attached.

Backgrounders available on the ANZFA website:

Attention TV news editors:

File footage of ANZFA, including an example of the labels, was distributed to TV stations in Australia and New Zealand as background information at the time of the Ministerial decision on the labelling of genetically modified foods on 28 July 2000.