It won’t be an easy road to reforming dairy industry structures, but we are not shy about facing the challenge head on.
The message, delivered by more than 1500 dairy farmers and other industry stakeholders during the Australian Dairy Plan workshops last year, was crystal clear that our existing structures – which have served us well for many years – are no longer fit for purpose.
Structural reform has therefore rightly become a central component of the Dairy Plan. To address this priority, a Joint Transition Team of industry representatives was tasked with developing structural options for industry’s consideration.
They delivered a report in January which recommended creating a single, whole of industry national dairy organisation to support industry services including policy, advocacy, research and development and marketing.
But while this model provided a solid foundation from which to build a new structure, further industry consultation is needed until we can be satis ed that a proposed structure will receive support from a majority of the dairy sector.
The federal government, which collects levies from dairy farmers that help fund the current structure, will play a key role in determining whether any changes should be made. The government must be con dent there is support from industry for the proposed changes.
It is not enough to ask the government to support such significant reform to the dairy industry without demonstrating that a majority of the industry stands behind this change.
The industry, or those advocating for change, must demonstrate there has been high levels of awareness for the change, participation in a vote, and support for the proposed new structure.
The Dairy Plan partner organisations – Australian Dairy Farmers, Australian Dairy Products Federation and Dairy Australia – have now established a process intended to meet these rigorous criteria.
It is based on a phased approach that engages industry around organisational design challenges and develops a new design for industry consultation and a vote around the recommended model. This process, which began in 2019 with the work of the Joint Transition Team, has continued throughout 2020.
This year, we are establishing a pathway to reform, engaging industry and government on any reform challenges, designing options for reform operating models and conducting industry consultation on those options. A proposed model should be finalised in 2021 for industry to vote.
An Organisational Reform Steering Committee has been formed, comprising two directors each from Australian Dairy Farmers, Australian Dairy Products Federation and Dairy Australia.
This committee will guide the pathway to reform and ensure appropriate consultation and vote prior to recommending a model. Ernst and Young and former MLA managing director David Palmer are leading the coordination, engagement and design efforts.
Three working groups have also been established to further support industry engagement.
One will be dedicated to exploring the potential involvement of dairy processors in a single industry body, including how a fully transparent financial contribution may work for mutual benefit.
Another will consider issues around governance, including how decisions should be made in a reform model that represents all sides of the dairy industry.
And the last will look at representation, such as how to strengthen advocacy without compromising delivery of research, development and extension via a single levy, while still ensuring there is a strong capacity to proactively participate in cross-commodity issues at both a state and federal level.
David Palmer is conducting listening meetings with all recognised leadership groups and capturing key principles and design input from the regions.
Assuming there is adequate support for a new structure, any plans for implementation will require close engagement with the federal government and all affected industry organisations. Legal, financial, and governance considerations must be fully explored.
This is a long, complicated process and should not be underestimated by anyone.
But our aim is to deliver lasting reform that will deliver stronger leadership, a uni ed industry voice, create a single point of contact for all industry services, deliver stronger industry funding, and ensure regional interests directly shape industry policy and advocacy.