Review identifies need for comprehensive reforms for chemicals regulator

In a development with implications for any industry that involves chemicals (including their handling), a range of reforms have been recommended in relation to the operations, conduct and governance of the Australian Pesticides and Veterinary Medicines Authority (APVMA).

Released today, the Final Report on Future Structure and Governance Arrangements for the Australian Pesticides and Veterinary Medicines Authority (APVMA) (Rapid Evaluation) concludes that the APVMA had lost sight of its fundamental identity as a regulator, as evidenced through unbalanced performance of regulatory functions and inequitable dealings with stakeholders.

With SPASA having had input to the review process as an industry advocate, the article below from SPASA Chief Executive Lindsay McGrath highlights the importance of that representation when the authority that governs the standards and systems under which we must operate is deemed lacking.

McGrath’s involvement and input influenced the outcomes, which is significant in light of the recognised stakeholder imbalance up to this point.

Comprehensive reforms set for chemicals regulator

In July 2023, Federal Minister for Agriculture, Fisheries and Forestry, Senator Murray Watt announced the public release of an independent review of the operations, conduct and governance of the Australian Pesticides and Veterinary Medicines Authority (APVMA) - the regulator for agricultural and veterinary (agvet) chemical products in Australia, which includes pool and spa sanitisers, oxidisers and algaecide.

Minister Watt commissioned the review, undertaken by Clayton Utz, which raised concerns about the integrity of Australia’s agvet chemical regulation and found there were serious systemic structural and governance issues present in the APVMA between 2019 and 2022, including leadership and management shortcomings, shortfalls from best practice as a regulator and deficiencies in stakeholder engagement.

Following the review, Minister Watt engaged Ken Matthews to complete an independent rapid evaluation of the review findings and to advise on future structure and governance arrangements for the APVMA.

The resulting Final Report on Future Structure and Governance Arrangements for the Australian Pesticides and Veterinary Medicines Authority (APVMA) (Rapid Evaluation) was released today, 17th April 2024.

The conclusions of Final Report include:

• By 2019-21, the APVMA had lost sight of its fundamental identity as a regulator, as evidenced through unbalanced performance of regulatory functions and inequitable dealings with stakeholders.

• APVMA became isolated from regulators and the Australian Public Service (APS), leading to erosion of its corporate culture.

• Resistance to the Board exercised effective oversight of senior management.

• Performance indicators were too narrowly defined, impeding measurement of APVMA’s overall performance as a regulator.

• Performance of regulatory functions became unbalanced.

• Stakeholder engagement was not evenly balanced across the full range of stakeholders.

The Final Report goes on to make 33 separate recommendations incorporating management improvements around culture, governance and leadership; confidence building measures including development of new regulatory performance indicators; and development of comprehensive funding reforms.

In meeting our organisational commitment to industry advocacy, SPASA has been involved in the review and evaluation process via participation in an industry consultative forum. As the SPASA representative on that committee, I find the actions of Minister Watt and the Federal Department of Agriculture, Fisheries and Forestry (DAFF) encouraging and the response to recommendations reassuring.

We understand that some recommendations are being initially rejected, including the proposal to move APVMA functions within a statutory office accountable to the secretary of DAFF. The APVMA will remain an independent statutory authority accountable to its’ own Board.

Minister Watt has announced a preference for independence and will also have the APVMA remain at its present Armidale location - a factor that was deemed at least partly responsible for the authority’s cultural isolation.

In some cases, rejection of a recommendation simply signals that more time is needed to work through the issues and determine the appropriate path forward.

As the industry’s peak body, we are buoyed by DAFF’s response and commitment to the serious reform needed to re-establish APVMA as an authority of integrity that adheres to regulatory best practice and maintains even-handed stakeholder engagement.

DAFF will release a detailed response to the Rapid Evaluation report mid-year, based on further input and analysis from both DAFF and the APVMA. It will address each recommendation in greater detail and incorporate input from previous reviews to offer a comprehensive outline of the government’s reform agenda for the APVMA.

In the meantime, as an industry advocate, SPASA will continue to work with DAFF and APVMA to ensure our seat at the table gives us an equal voice in the latest evolution and future direction of the agencies and authorities that govern our standards and practices.

The Rapid Evaluation report and the government’s preliminary response to the recommendations is now available on the Federal Department of Agriculture, Fisheries and Forestry website at www.agriculture.gov.au/apvma-rapid-evaluation