Pressure for oversight of wool levy spending

Oversight pressure of AWI's wool levy spending


Sheep
Livestock SA vice president Joe Keynes (centre), pictured with SA Merino sire evaluation chairman Roger Fiebig and and SA Sheep Industry Blueprint manager Stephen Lee.

Livestock SA vice president Joe Keynes (centre), pictured with SA Merino sire evaluation chairman Roger Fiebig and and SA Sheep Industry Blueprint manager Stephen Lee.

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AUSTRALIAN Wool Innovation top chiefs’ grilling over expenditure of compulsory levies at the recent Senate estimates has triggered state farming organisations to move to instate a peak industry group to closer scrutinise their spending.

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AUSTRALIAN Wool Innovation (AWI) top chiefs’ grilling over expenditure of compulsory levies at recent Senate estimates has triggered state farming organisations to instate a peak industry group to closer scrutinise their spending.

The national campaign has been instigated by Victorian Farmers Federation (VFF) livestock council who unanimously passed a resolution last week to instate WoolProducers Australia as the legislated wool body, citing the “need for the wool industry to enter the 21st century”.

WA Farmers are seeking action from Federal Agricultural Minister Barnaby Joyce to legislate WPA as the peak wool industry group, alongside VFF, while SA Livestock and Tasmanian Farmers and Graziers Association will determine their position later this month.  

“… The Senate estimates hearing showed AWI needs oversight with producer funds,” VFF livestock president Leonard Vallance wrote to Fairfax Media.

“It was a display of arrogance that levy-paying members are struggling to understand.

“AWI has a responsibility to use levies in a responsible manner.”

Mr Vallance referenced AWI’s generous redundancy payouts to staff – one including almost $100,000 above its legal obligation – which were revealed in the recent Senate estimates.

Unlike Meat and Livestock Australia (MLA), which has peak industry councils that provide policy direction, scrutinise budgets and monitor MLA’s performance on behalf of the red meat industry, AWI does not have a legislated industry group.

“(The Senate estimates) has raised the question, are AWI truly accountable and transparent with the expenditure of levy funds?” Livestock SA vice-president Joe Keynes said.

“It has highlighted an issue that has been bubbling away for a long time.

“We want the industry to work closely with AWI, including industry councils and bodies; the question is whether they are able in the current situation.”

In 2010, AWI introduced the Woolgrower Industry Consultative Committee (ICC) to engage with six woolgrower representative organisations.

WPA senior vice-president Ed Storey, and NSW Farmers wool committee deputy chair, said legislating WPA would improve best practice governance.

Mr Storey said AWI’s expenditure decisions lacked oversight, citing a WoolPoll panel recommendation to include a levy option of 1.5 per cent at the 2015 vote which was “ignored” by AWI.

“This is an example where it would be better to have oversight of that process, other than AWI who are recipients of the levy," he said.

“It strikes me as strange why wool is unique to other industries because it is a big compulsory levy, 2pc of your gross.”

Mr Storey said third party oversight was also critical when electing a company to undertake AWI’s Independent Auditor Report to avoid “influence”.

“It is not about getting into the day to day business of AWI, but if barely 51pc of WoolPoll votes are returned that would indicate something is not quite right in terms of levy payer engagement,” he said.

“This is ensuring governance arrangements are best practice to ensure the most effective use of the 2pc levy in the long run.”

AWI did not respond to questions from Fairfax Media. 

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