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Re-arranging the decks chairs on the Titanic

Titanic

The whole of the meat industry and its structures have come under intense scrutiny recently,  with the Senate recommendations making many start ‘circling their wagons’ to ensure that radical changes do not go ahead, and take their snouts out of the trough.   

Cattle Council had finally taken action during 2012 to find out what their members and producers in general wanted for their industry.   Despite the producers’ well documented visions, and the author’s write-up of what he was told by producers, the report did not suit the State Farming Organisation controlled CCA Board,  and the intentions behind the restructuring of the CCA went out the window.   

Consequently, the producer written proposals for the New Cattle Board (which removed the SFO’s control over CCA, took control of the levy money, and gave producers a democratic and transparent Board) were quickly dismissed. 

That was in December 2013, after a year of many of us working hard to deliver the  restructure that CCA begged for, but didn’t really want. 

What they really meant by ‘restructure’ was to just be given more of the levy dollar, and to be left alone to operate as they have always done.   

The next change to be mooted to producers was that MLA would now review their programs and management.  These promises came about following the changeover of CEO in MLA, and under two women – Michele Allen and Christine Gilbertson – things began to happen.  ABA acknowledges that there have been major changes, ongoing since Richard Norton joined MLA, but NONE OF THIS change of management of the (still dysfunctional) MLA changes anything for the grass fed producer. 

Despite any changes in personnel and management in MLA, the way CCA interacts with MLA is STILL controlled by the MoU -   which gives producers and their Peak Council  (CCA) absolutely NO control over their industry, their $50million+, their decision making, or their selection of their own Board members.   That has not been changed!!

MLA might be making a clean sweep, and we hope they will do a forensic accounting of the books too, to see where all the money has gone (like $350,000 for just one of those murderous killing boxes in Indonesia with MLA stamped all over the side of it) ….but none of this changes the situation that producers have been in since 1998!!!  

And the shuffling of the deck chairs on the Titanic goes on…

RMAC was set up in 1997/98 to provide a ‘single industry voice of advice’ to the Federal Government when dealing with cross sectoral and whole of industry matters. 

Immediately  this brings to mind  RMAC’s  biggest test –  the live shipping crisis when the RMAC  (Red Meat Advisory Council)  could not agree on what action to carry out, as 2 of its Board members were processors who actively worked against live shipping.  These processors blocked all actions, and producers have to realize that (unlike other peak councils who pay more in levies) the AMIC had two representatives sitting around the RMAC table. 

How can processors have two seats when they only pay about 1/6th of what producers (with only 1 seat) pay to MLA – but this just highlights the mismanagement of the whole industry structure.    

 

RMAC, (Red Meat Advisory Council), which is chaired by ex-processing industry man Ross Keane, is now on tour across Australia presenting the Meat Industry Strategic Plan.  See if you can find the dates and times!!   

The MISP has been delivered every 5 years or so by MLA themselves.  But now RMAC, when realizing that everyone wonders what they actually do (other than sitting on $40million+ of Levy Reserve Funds, most of which would be grassfed producers’ levies),  thought they had better develop a website (which you cannot get into);  and that they had better been seen in public doing ‘something’. 

The RMAC website tells you nothing about the MISP tour.  We found some information after a detailed search.  Very few knew it was on, including the print media!! 

For those who might be interested in future meetings:

For more information about the MISP and all media enquiries, please contact:  Angus Hobson, RMAC CEO

(M: 0487 800 066 / angus@rmac.com.au)    Or type into Google:   Workshops – Meat Industry Strategic Plan 

 

1st October             Charleville

2nd October            Perth  WA 

9th  Oct                   Broken Hill   NSW

13th Oct                  Wagga Wagga   NSW

14th Oct                  Attwood  Vic

16th Oct                  Hamilton  Vic

23rd Oct                  Launceston  Tas

 

In their 52 page report to the Senate enquiry RMAC included a lot of information from the days of the formation of MLA from the old AMLC.  It is stated in the executive summary that there was a need in the meat industry for sound systems and governance, reporting to all levy streams, and therefore this warrants consideration under RMAC membership.  (Whatever that means!!)

Included in the RMAC report to the Senate was the original message from John Anderson, Ag Minister who created MLA on July 1, 1998.  His letter states …”that MLA will deliver a more efficient structure and of most importance, gives ownership and control of the industry back to everyone involved in meat production in Australia” !! 

(Notice the words ‘meat production’ as opposed to cattle production – which is what happened with the processors.  They took the set up that was delivered, and used the situation to strengthen their power base).  

Mr Anderson continues:   “These arrangements are among the most significant and import reforms ever undertaken by the government. They signal a new direction of cooperation between government and industry.

These reforms have been designed by industry for industry. They address concerns expressed over many years by growers and processors alike, about key functions such as marketing and R&D, and about the lack of influence, lack of control.

The new arrangements place responsibility everybody involved in the red meat industry producers, feedlotters, processors and exporters alike.”

The minister goes on to say “I’m confident this new structure will deliver lasting benefits across all areas of the red meat production. It is now time that everybody involved in the cattle, sheep, goat production in Australia to embrace the new arrangements.”

You, the reader, should go on and read the attachment we have placed below this article.  It will highlight to you the mis-shapened reforms that were carried out, the unbalanced nature of the payments made by each Peak Council, the ability of some to make their own policies and the inability of others (namely the grass fed cattleman) to control policy. 

Read the part about funding of MLA by processors, and the Live Exporters who were supposed to contribute toward MLA.  They’ve stopped making those contributions – why?

RMAC themselves give answers, of a sort.   Read the other article. 

How RMAC and CCA can have the audacity to present themselves as good representative of all sectors of the industry after you read this will amaze you.  Like the answer to Q1: about how much control the payers will have over voting and having a more direct say in things.    

Read Q5: about why processors are no longer required to pay for promotional activities – producers have no such clause and they are forced to pay for marketing which does a great deal for the supermarkets and processors while doing nothing for producers!

In other documents it is stated:  MLA is a company receiving compulsory levies and other taxes. It is not a shareholding company where owners have the choice to withdraw their investments.   MLA will be required to provide services to its members on the most efficient basis and where appropriate through a process of contestable tender.  (Really??!)

It states, there must be accountability transparency, except where there is specific requirements for an activity be classified as ‘commercial in confidence’.   Otherwise all activities will be fully transparent to members. (Oh yeah???)  

As producers and ABA well know, every time there was a problem, MLA had made an art form of hiding behind ‘commercial in confidence’, which meant that we could find no answers to numerous queries. 

From my point of view RMAC’s  biggest test came with a live shipping crisis when they could not agree as processors actively worked against live shipping and unlike other peak councils who pay more in levies, AMIC had two representatives sitting around the RMAC table.

My conclusion that the whole set up, RMAC, MLA, CCA has been a complete disaster for grass fed cattle producers, and has seen processors, supermarkets, and the duopoly of retailers reap rewards out of our statutory levy.  But that all essentially comes down to how the CCA was set up to interact with the other Boards, and how we have to change that. 

The 2014 Senate Report encourages the establishment of a New Cattle Board, plus numerous other significant changes.  Most producers will be delighted with the report. 

However, the strongest fact remains, that a whole new structure can be implemented, and still achieve little to nothing for the producer.  How this new board is structured, how it represents producers, how it manages the levy funds, and how it manages itself in relation to the other players in the domestic and world beef meat market is critical.

Careful planning is essential.  History has taught us a lot, and we need to reflect on it as we work with the Minister and government to bring about better management of a huge industry. This is a huge undertaking for Barnaby Joyce and his government, but we currently have support from every side of politics for the change to happen (thanks to the Senate), and we must act on that. 

To let this opportunity pass would be a huge failure on our part.  We have to be responsible for ourselves by being responsible to the process. 

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