Review of the $2900 Approved Arrangement levy

Freight & Trade Alliance (FTA) continues to be inundated with concerns from members affected by the $2900 Approved Arrangement levy.
 
The Department of Agriculture and Water Resources calculated the 2016 / 2017 financial year levy for Approved Arrangements based on the cost of providing the framework ($7.2m) divided by the number of estimated participants (2499). The result being that all businesses holding a unique ABN that operate an Approved Arrangement has been forced to pay the annual levy of $2,900 - in other words, regardless of how many Approved Arrangements a business may hold, they only pay one levy.
 
This approach allows medium to larger size businesses to group a number of activities and sites under the one ABN and under the one fee structure delivering a substantial saving and harmonises all the approval and fee periods.
 
On the flip side, questions have justifiably been asked why a multinational entity should pay the same flat fee for multiple Approved Arrangement facilities and accredited individuals as against a stand-alone small business with perhaps one or two accredited individuals.
 
In response to concerns raised by FTA, the department explained that substantial industry engagement was completed on this (prior to FTA being invited to formal consultative forums during 2016) and coincided with the delivery of a full Cost Recovery Impact Statement (CRIS).
 
At a FTA member forum in Sydney on 19 October 2016 there were calls from many of the delegates for a collective boycott of the Approved Arrangement program until a fairer cost recovery arrangement is implemented.

Whilst this was not a realistic remedy, it was important that this level of concern was expressed by members direct to the departmental representatives to reinforce the FTA advocacy efforts on this issue.

At a follow-up FTA Member Forum held in Sydney yesterday, 17 May 2017, the same message was reinforced to the departmental representatives. In response, Jason Lucas (Acting Assistant Secretary – Industry Support) acknowledged that the existing structure is under review and is a high priority.

While that is encouraging news, small businesses are not going to see immediate relief.

Mr Lucas explained that the $2900 fee is embedded within legislation and that it would take time to complete any change in the fee structure.

FTA will continue to advocate for an early change to this arrangement however the reality is that members wishing to maintain their Approved Arrangement status will again be subject to the $2900 renewal fee on 1 July 2017.

FTA has sought a commitment from the department that should a change take effect during the course of the financial year, adjustments would be administrated depending on the format of the new arrangements.   

In the interim and in response to member requests, FTA will also pursue periodic payment options with the department as a means of easing cash flow implications on small businesses. We trust the department will give consideration to this request, at minimum on a case-by-case basis, to ensure that the individual circumstances are appropriately considered.

While we will continue involvement in formal departmental consultative forums, we are pleased to advise that a break-through has been achieved with a commitment for direct and regularly scheduled meetings between the department and FTA representatives specifically focussing on cost recovery issues.

We appreciate members' concerns but ask for further patience as we work through this new departmental engagement process. As always, we will keep members up to date on all developments.