Back to NCP Review of the Uniform Trade Measurement Legislation Index

2. Methodology

The guiding principle for a NCP review of legislation, as contained in Clause 5(1) of the Competition Principles Agreement, is that legislation should not restrict competition unless it can be demonstrated that:

• the benefits of the restriction to the community as a whole outweigh the costs; and
• the objectives of the legislation can only be achieved by restricting competition.

Any proposal to retain or introduce legislation that restricts competition must be supported by a PBT that demonstrates compliance with the guiding principle. This requires an assessment of the costs and benefits associated with the legislation in question and alternative options.

According to clause 9 of the Competition Principles Agreement a NCP review of legislation that restricts competition should:

1. clarify the objectives of the legislation;
2. identify the nature of the restriction on competition;
3. analyse the likely effect of the restriction on competition and on the economy generally;
4. assess and balance the costs and benefits of the restriction; and
5. consider alternative means for achieving the same result including non-legislative approaches.

The structure of this report follows 1-5 above. In assessing costs and benefits, the following key issues were considered, where appropriate, in accordance with clause 1(3) of the Competition Principles Agreement:

1. government legislation and policies relating to ecologically sustainable development;
2. social welfare and equity considerations, including community service obligations;
3. government legislation and policies relating to matters such as occupational health and safety, industrial relations and access and equity
4. economic and regional development, including employment and investment growth;
5. the interests of consumers generally or of a class of consumers;
6. the competitiveness of Australian businesses; and
7. the efficient allocation of resources.

As noted in clause 1(3), the assessment of costs and benefits not only encompasses economic and financial variables, but also can take account of social, environmental and other considerations. During this review the value of costs or benefits have been quantified where possible. However, where quantification was not possible, the cost or benefit has been described in qualitative terms.

A minor assessment has been conducted on the restriction on the sale of non-prepacked meat due to the minor nature of the restriction. Criteria used in determining the type of assessment included the extent of the restriction, size of the stakeholder impact as a result of removing the restriction, complexity of issues and community concern.

Consultation with affected groups was an integral part of the review process. In 2000 the Trade Measurement Advisory Committee ("TMAC") consulted industry and consumer groups on a range of proposed changes to the trade measurement legislation. This consultation involved the release of an issues paper regarding the possible removal of the restriction on the sale of non-prepacked meat. The issues paper was forwarded to approximately 283 stakeholders and section 7 provides a summary of the submissions received. The Review Committee has conducted further targeted consultation with industry and consumer organisations and various Australian and overseas government departments.

The Review Committee also conducted direct consultation with meat sellers to determine the impact of the restriction on their business. A total of 46 meat sellers were consulted during the review. 26 meat sellers were consulted in Queensland to determine the impacts generally, as well as the potential impact of extending the restriction to poultry and fish. 20 meat sellers were consulted from the remaining jurisdictions. The meat sellers were chosen randomly and represent a mix of regional and rural businesses.

Back to NCP Review of the Uniform Trade Measurement Legislation Index