Introduction
In 1995, the Australia New Zealand Food Authority (ANZFA) was asked by the Australia New Zealand Food Standards Council (ANZFSC) to develop nationally uniform food safety standards for Australia. ANZFA has developed four standards which will be recommended to ANZFSC in mid-1999 for adoption into theFood Standards Code. They are:
Standard 3.1.1 Interpretation and Application
Standard 3.2.1 Food Safety Programs
Standard 3.2.2 Food Safety Practices and General Requirements
Standard 3.2.3 Food Premises and Equipment
The proposed implementation of food safety standards represents an important shift in the manner in which food safety is regulated. In contrast to the current food hygiene regulations, which rely largely on inspection and documentation of failure, the food safety standards will introduce systematic methods to minimise food contamination.
The proposed national system is performance orientated and less prescriptive. It is designed to replace the existing array of regulations which are inconsistent, outdated in some jurisdictions and inappropriate for modern food handling processes. Public health and safety outcomes were the principal parameters used in developing the standards, which have taken into account standards developed by the Codex Alimentarius Commission and other countries including the United States, Canada and the United Kingdom. As well as providing Australia with nationally consistent food safety legislation for the first time, the standards are in line with measures introduced by Australia’s major trading partners.
Whenever new legislation is proposed, or existing legislation amended, a regulatory impact analysis is required. In this document, ANZFA has sought to identify and, wherever possible, quantify the impact of the food safety reforms on the community, the food industry and government.
Due to the lack of active surveillance, data on the incidence of foodborne illness in Australia are limited. This makes it difficult, not only to accurately assess the current costs and economic impact of foodborne illness, but also to quantify the extent of economic benefits to government and the community of any reduction in foodborne illness that may occur as a result of introducing the food safety standards.
Within these limitations, ANZFA has used available data from a variety of sources to assess, and quantify where possible, the net effects of the proposed standards. Where Australian data are lacking, ANZFA has augmented the analysis through using data from other advanced economies such as the United States, Canada, New Zealand and the European Union.
In this regulatory impact analysis, ANZFA has sought to quantify the:
• incidence of foodborne illness in Australia;
• cost of foodborne illness in Australia;
• current and anticipated cost to government of regulating food safety;
• current and anticipated cost to the food industry of compliance with food safety regulations; and
• anticipated benefit to the Australian community of introducing nationally uniform, performance based food safety standards.
ANZFA commissioned three independent studies on the impact of the proposed reforms on the food industry and State, Territory and local government. These were carried out by KPMG Management Consultants, Heyhoe and Associates and John Hawkless Consultants. In relation to costs to business, ANZFA has concentrated on the impact on small business. Most larger food businesses have already adopted the approaches set out in the standards and will not face additional cost from changes in the regulations.
The regulatory impact of the food safety standards has been considered only for Australia. The standards are outside the 1995 Agreement between Australia and New Zealand for setting joint food standards, and as such, will not apply to New Zealand.
Statement of the problem
The current food hygiene regulatory environment
State and Territory food law
While Australia has nationally uniform food standards, which are contained in the Food Standards Codeand adopted by reference into State and Territory food law, this does not apply to food hygiene regulations. The prevailing food hygiene legislation in Australia is described in Figure 1.
Figure 1 Current primary and subordinate legislation in Australia
State or Territory | Primary | Subordinate |
Western Australia | Health Act 1911 | Health (Food Hygiene) Regulations 1993 |
|
| Health (Adoption of the Food |
|
| Standards Code) Regulations 1992 |
|
| Health (Game Meat) Regulations 1993 |
|
| Pou ltry P rocessing Es tablishm ent Regulations |
Tasmania | Tasmanian Health Act 1962 |
|
| Public Health Food Act 1997 |
|
Queensland | Food Act 1981 | Food Standards Regulation 1994 |
|
| Food Hygiene Regulations 1989 |
Victoria | Food Act 1984 | None |
| Food (Amendment) Act 1997 |
|
South Australia | South Australian Food Act 1985 | Food Hygiene Regulations 1990 |
Northern Territory | Food Act 1986 | Food (Administration) Regulations 1995 |
|
| Food (Interim Provisions) Regulations 1995 |
|
| Food Standards Regulation 1998 |
New South Wales | NSW Food Act 1989 | Food (General) Regulation 1997 |
| Food Production(Safety) Act 1998 |
|
Australian Capital Territory | Food Act 1992 | Public Health (Sale of Food and Drugs) |
|
| Regulations 1928 |
|
| Public Health (Meat) Regulations 1928 |
As each State and Territory has its own food hygiene regulations there is a lack of national consistency. In some jurisdictions these regulations have not been updated and are inappropriate for modern practices.
Local government
There are over 700 local councils in Australia which can make by-laws or ordinances to regulate food businesses (Food Regulation Review Committee 1998). In general, these powers are used infrequently, often only to apply fees and charges for inspecting premises. However, some councils have created laws to supplement State food hygiene regulations (Food Regulation Review Committee 1998). This adds another level of non-uniformity to food safety regulation in Australia.
Outdated requirements
As can be seen from Figure 1 a number of jurisdictions in Australia rely on legislation and regulations written up to 70 years ago. Some of these are quite inappropriate for business, regulators and the community in 1999.
Every place where food for sale is handled must provide a properly constructed and closely covered manure receptacle into which the proprietor shall cause to be placed daily all animal droppings and stable cleanings. 3
Since the requirements were written, the use of horse-drawn vehicles in the food industry has ceased. However, if a business chose to revert to horse-drawn vehicles, the prescriptive requirement for manure receptacles described above would be covered by the garbage requirements in the proposed standards.
Fish shops are required to have two doorways (one for business and one for service) and a bakehouse cannot be used unless the interior walls are either painted with oil paint or kept well lime washed. 4
ANZFA has sought to draft minimum effective regulations into the proposed food safety standards to replace the plethora of prescription, and to reflect current food safety knowledge and practices. The outcome sought is for safe food and it is recognised that this can be achieved in a variety of means appropriate to the particular business.
Tasmania, the Australian Capital Territory and the Northern Territory require floors to be drained to drain inlets situated outside the building within which the floor is laid.
These prescriptive requirements do not necessarily lead to a safe food outcome and are inappropriate for modern buildings. They have been changed to provide flexibility while still achieving the desired result of safe food, that is:
Food premises must have a sewage and waste water disposal system that:
(a) will effectively dispose of all sewage and waste water; and
(b) is constructed and located so that there is no likelihood of the sewage and waste water polluting the water supply or contaminating food.
Prescriptive requirements
State and Territory regulations prescribe that businesses must meet very specific requirements for design and construction of premises and equipment. However, the food industry is complex and it is impossible to prescribe for every eventuality. In addition, the approach is restrictive and does not encourage industry to develop better or less expensive ways of making food safe.
Window sills located in areas in which food is prepared and in which splashing or soiling is likely to occur shall be situated not less than 300 millimetres above the top of any bench or appliance that is in a position below or adjacent thereto. 5
In the ACT, where a space is provided between cooking appliances or between them and other fittings such space is to be at least 75 mm for cooking appliances up to 750 mm in width. For widths over 750 mm at least 300 mm clear space is required. 6
Food is not to come into contact with nor is any package or appliance to be used that consists wholly or partly of antimony, arsenic, cadmium, lead, mercury or other poisonous metal or a compound of any of those substances 7 other than a surface of glazed ceramic ware that complies with BS 6728-1986. 8
Inconsistent requirements
Development of food hygiene regulations by individual States and Territories has resulted in regulations often with similar intent but differing markedly in their detail and prescriptiveness from jurisdiction to jurisdiction.
Coving In New South Wales and Queensland, floors must be coved with a radius of 25 mm at the walls. In Western Australia coving must be a minimum of 9.5 mm. In Tasmania and the Northern Territory there are no requirements for coving in the regulations but there are in the Building Code and no radius size is given. Victoria and South Australia have no requirements in regards to coving and in the Australian Capital Territory the Construction Code requires floors to be coved but no size is given. |
The issue is not so much the price difference between 25 mm coving as opposed to 9.5 mm but the time taken for businesses which operate premises in more than one jurisdiction to determine local requirements. Whether 25 mm coving is any more effective in producing a food safety outcome than 9.5 mm coving is altogether another issue.
Businesses not only have to comply with differing construction standards across States and Territories, but also with a range of food safety practices such as sanitising temperatures. Each of these differences, although small, compounds the compliance burden on businesses operating across State or Territory borders.
Sanitising Hot water can be used for sanitising but the stipulated temperature depends on where the business is located.
|
There are many other examples of requirements in current State and Territory food hygiene legislation that are not only inconsistent between jurisdictions but also inefficient or worthless in achieving safe food outcomes.
In contrast, the proposed food safety standards specify the desired outcome for design and construction requirements of food premises and equipment—essentially, that they can be maintained in a clean and sanitary condition. Food industry guidelines are being developed to help businesses meet this outcome.
Inconsistent interpretation
As well as the problems for business of complying with outdated, prescriptive and inconsistent regulations, inconsistent interpretation of the regulations by different councils and Environmental Health Officers can further add to the regulatory burden on business. Non-uniform enforcement can also cause distortions and inequalities between businesses in different jurisdictions (Office of Regulation Review 1995).
The public submissions received in relation to ANZFA’s food safety information papers (September 1996, July 1997, March 1998 and October 1998) indicated strong in-principle support for reform of the current State and Territory food hygiene regulations and the need for a nationally uniform system (including uniform enforcement).
ANZFA recognises that enforcing outcomes-based standards is more difficult than finding non-conformities relating to coving width and distances between appliances and other fittings, as can be the case under prescriptive regulations. To help explain the standards, ANZFA is developing an interpretive guide for relevant authorities on the rationale of the new requirements and ways in which outcomes can be achieved. Industry guidelines will help businesses find the best, most cost-effective options to meet safe food outcomes.
The Australian food industry
Turnover
Australia has a dynamic food industry with an annual retail turnover, in 1996–97, of $52 billion (Australian Bureau of Statistics 1998). In addition, Australia exported around $11 billion of manufactured foods and over $9 billion of agricultural produce in 1996–97.
The Australian food industry is responsible for providingover 20 billion meals every yearin Australia |
Number of businesses
Estimates of the size of the Australian food industry vary markedly depending on the ways businesses are categorised. Data from the Australian Bureau of Statistics indicate a total of 68,042 food businesses in 1996. In contrast, a 1998 study by KPMG Management Consultants based on questionnaires and interviews with government authorities around Australia indicates that there are some 131,500 food businesses in Australia.
There is significant discrepancy between the Australian Bureau of Statistics data and the KPMG study. This may be because many food businesses in Australia are ancillary to other businesses. For example, the Australian Bureau of Statistics data would not pick up food services provided by service stations where the primary business is retailing petroleum products, not providing food.
In this analysis, the KPMG figure of 131,500 has been used as it is seen to be the most accurate estimate of the number of food businesses in Australia.
Number of small businesses
‘Small business’ is defined as a business employing less than 100 people in the ‘manufacturing’ sector or less than 20 people in the ‘services’ sector (Department of Workplace Relations and Small Business 1998).
Using this definition of small businesses, the total number of small food businesses in Australia, based on the KPMG data, is 125,800. Of these, the number of small retail businesses is taken to be 121,970.
Industry trends
Internationally, our major market competitors (including the United States, Canada, New Zealand and Europe) are establishing safe food systems similar to those proposed for Australia, with the clear goal that assurances of safe food will deliver a market return.
In Australia, many larger manufacturers have already moved to preventative food safety management systems. Larger retailers, fast-food franchises and Australia’s export markets increasingly demand that their suppliers implement audited food safety programs as a means of verifying the safety and quality of the products they buy.
The proposed reforms reflect an approach which has already gained acceptance, has been implemented by most of the larger food businesses in Australia and is increasingly seen as the basis for good business practice. There are significant market and commercial pressures for food businesses to adopt preventative approaches to assure safe food in line with the proposed standards.
The standards also represent a significant driver for accepting and implementing these approaches in sectors which have yet to be exposed to the industry-driven requirements for auditable food safety programs, particularly small business.
Industry competitiveness
There are strong economic reasons for selling consistently safe food and maintaining consumer confidence in the food supply. In addition to the immediate damage to the company involved, failure in one business can affect the entire industry. For example, failure of ham products or mettwurst has, at times, affected the entire smallgoods industry with damage to consumer confidence lasting for years. Similarly the 1997 outbreak of hepatitis A from oysters in New South Wales not only reduced oyster consumption across Australia but caused a significant downturn in sales of unrelated seafood products for a prolonged period.
Expectation of consumers that their food supply is safe
In addition to industry recognising the imperative to provide a sa fe f ood produ ct, co nsumers expect their food to be safe—all the time. It is well recognised that while there can be far greater risks to health than unhygienic food, the safety of food is something the community is unwilling to see compromised (Swinbank 1993). This expectation of consistently safe food is an issue which has to be considered throughout the regulatory impact analysis.
Surveys conducted by the Australian Supermarket Institute indicate that consumers in 1996 were more concerned about food hygiene compared to an earlier survey in 1992 when consumers indicated that pesticides and chemicals posed the greatest threat to the safety of food. In 1996, the unhygienic handling of food by staff and shoppers and the overall hygienic status of food rated far higher.
In a nationwide survey conducted in the United Kingdom in 1993, 45 p er cent of consumers claimed to have been deterred from some kind of food because of the risk of food poisoning ( Henson 1996). These concerns were said to have been fuelled by increasingly vocal consumer groups questioning the efficacy of existing government food safety regulations.
As discussed later in this analysis, the incidence of foodborne illness is increasing worldwide and is a serious public health issue for Australia. No one can guarantee that all 20 billion meals consumed each year in Australia will be free of foodborne pathogens. However, by seeking improvements in the hygienic production and handling of food in direct relationship to the hazard posed, it is possible to minimise the risk to public health and reduce the incidence of foodborne illness.