Food Labelling Policy Review
A plea for the re-establishment of truth in trading.
1. Introduction
I am making this submission as a consumer. The four concerns set out in the introduction to your consultation paper do not fairly represent my standpoint as a consumer. I would rewrite your concerns:
· most consumers have no difficulty in understanding labels on food, they understand them as advertising.
· all the costs from labelling are placed on the consumer and the Government, they are being ‘externalised’ by the food industry.
· there appears to be no enforcement of such weak food labelling laws as exist.
· the food industry’s approach to labelling is at best ‘economical with the truth’ and at worst downright lies. The sole object is to sell product and maximise profits.
A more balanced statement of concerns that reflect the interest of consumers would have been desirable. The idea that consumers have difficulties in understanding labels because of Government regulations is frankly offensive to consumers.
2. Why Label Food.
The labelling of preserved food is a very ancient practice, but until the advent of food manufacturing in the mid nineteenth century, this was mainly a domestic practice. In modern terms, consumers labelled their own food. Think of jam, chutney or potted meat.
The origins of commercial food labelling go back to Baron von Liebig in 1865. Prior to this most foods were unprocessed and knowledge of the nature of the foodstuff was widely shared between consumers and producers. It was the practice of manufacturing food that necessitated labelling. Consumers were loath to buy the unwrapped Oxo cube or the plain tin of Fray Bentos corned beef. Early labels provided consumers with the sort of information they might have otherwise obtained from a good butcher or grocer.
Your paragraph 2.4 states that the crux of your review is to ‘address the tensions between fair and competitive trading in the market’, but you fail to define fair or competitive. Markets for food were historically ‘free markets’ in Adam Smith’s terminology, and they approximated to being ‘perfect markets’ in the sense that there were many buyers and many sellers who shared common information about the product. The rush to brand and differentiate food products that has occurred in the last 60 years has had the effect of reducing the numbers of sellers, and withholding information from buyers such that there can no longer be said to be a free or a perfect market. This is decidedly not ‘fair’ to consumers and it is not competitive.
Submission point 1: Define ‘fair and competative’ more clearly; ground your statements in the economic theory from which they derive, and give a proper account of how labelling has evolved and has been used to disadvantage consumers.
3. Government and food labelling.
The whole emphasis of your review seems to be biased towards the Government’s role in public health (a worthy cause) to the detriment of its role in protecting consumers or its role in ensuring that there are fair and competitive markets.
Governments have long assumed the role of protecting public health in relation to food, be it the prevention of the spread of disease (TB in milk) or adulteration with damaging substances (Ergot in flour). Individual consumers cannot be reasonably expected to have the resources to undertake the kind of research necessary in our complex world, to pursue these issues individually. But consumers also have the right to know what they are buying so they can signal through the market place what they want, it is just as much the role og Government to ensure this as it is to protect public health.
Submission point 2 (Question 1): The Government should use the food regulatory system to achieve public health benefits, but this should be used in conjunction with other measures to achieve fair and competitive behaviour by the food industry and provide for well informed and discriminatory consumers.
From my standpoint, adequate information is quite simply the information that a consumer needs to make an informed choice. It is the seller’s responsibility to provide this information. That is what a fair market is! The producer’s ‘problem’ is that food production and processing have become so complex that even well intentioned producers find it difficult to provide the information. Again using the example of a meat product, 60 years ago I could have gone to my local butcher and asked for a cut of grass fed Merino lamb and he would have understood the question and possibly supplied the product. I have asked this same question in 6 supermarket chains in Australia and New Zealand over the past two years and not a single member of staff understood the question. So, as a consumer, I cannot exercise choice.
Traditionally the information was given by a producer or a single intermediary such as a butcher or a grocer. Labels were not necessary. I would be delighted to see labelling abolished and a return to the situation where producers were required to attend the point of sale to answer consumers’ questions on a regular basis, say weekly. But, given that the average meat pie might now contain ingredients from 50 producers in 10 countries and that there are often over 1000 food lines in most supermarkets this approach might lead to a situation where consumers found it difficult to enter a supermarket. This may seem trivial, but I am making a serious point, it is the food industry and retailers that have brought this situation about by lengthening supply lines and complicating food processing. Consumers did not ask for this approach and they should not be asked to pay the costs of redressing the balance.
Submission point 3 (Question 2): accurate information on all the contents of food products, including place of origin, type of ingredient, and methods of production, processing and storage should be provided. It should be the seller’s legal responsibility to provide this at the point of sale. An independently verified factsheet at point of sale is probably the only practical means of doing this. Your review needs to focus on information provision rather than just labelling. Websites are fine if they are independent and contain no misleading information or advertising, but there are very few of these. Education would be a very useful tool, the standards of knowledge amongst staff in food processing and retailing industries are appallingly low in relation to what it is they are selling. I note that some French supermarkets have pioneered provision of product information by introducing factsheet terminals operated by product barcodes. This might be the way to go.
The issue of accurate and consistent labelling is very difficult because the law does not address the issues traceability, transparency and completeness. The current law disadvantages small and honest producers. Clearly higher standards of labelling (and accompanying information) are needed. Consumer protection legislation is the best place to achieve this and these laws are in urgent need of strengthening to protect consumers.
Submission point 4 (Question 3): accurate and consistent labelling can only be achieved by strengthening consumer law to require retailers to provide customers with full disclosure statements on the products they sell that have been generated by appropriate independent agencies or scientists.
The discussion paper states that COAG require that costs (of regulation) need to be balanced against the benefits (of protecting consumers and maintaining fair and competitive markets). But you seem unaware of the fact that it is the food industry and retailers that have changed the operation of the food market quite dramatically in the last 60 years in a way that dumps the cost burden on us as consumers and on Government. They should pay.
Submission point 5 (Question 4): The underlying principles should be:
· protection of consumers rights to make market choices based on full and accurate information;
· the operation of fair and competitive markets that benefit all consumers and all producers.
Most political parties subscribe to these principles.
As the food industry evolves ever more complex and opaque processes they should be required to fund the necessary costs to ensure consumers are properly protected and fully informed.
Submission 6 (Question 5): The criteria that should govern the means of intervention should include:
· effectiveness: that the instrument achieves it purpose.
· fairness: that those responsible for a product or service bare the external costs, not the consumer or the government
· neutrality: that it should not disadvantage any particular group of producers or consumers. (Many of the changes of the last 60 years have substantially disadvantaged small producers in the food industry)
3. Key roles of food labelling.
The issue of what foods should be labelled is clearly very complex. In principal it should not be necessary to label foods that are being sold directly by their producer. It also seems fair to allow small producers some exemption from labelling requirements.
Foods that are processed on the premises be they restaurants, caterers, small goods suppliers and the like should have a requirement for accurate disclosure, preferably by an accurate factsheet available for the customer’s inspection at the point of sale.
Foods sold loose such as vegetables and some groceries should require labelling at the point of sale. That labelling should state:
1. the name and address of the producer(s) which would include country of origin.
2. the species and variety of the product; following the example of the fishing and apple industries, this should include details of genetically modified products. e.g. sheep meat – merino; apples – Granny Smith.
3. the date on which the product was picked/ killed/milled etc.
4. the production method; e.g. feedlot, grass fed, organic etc. the terms having been determined by Government or independent standards authorities.
5. any preservation processes used; e.g. irradiation, cool store etc.
For packaged food all the above apply and additional requirements are covered in your discussion paper.
Submission 7 (Question 6): Labelling requirements are wholly unsatisfactory. They are not transparent in terms of the nature of the product being sold, its place and date of origin, the methods used in its production, processing and storage nor its potential effects on human health or wellbeing.
I fundamentally disagree with your statement (3.2) that public health issues are the obvious driver of food labelling. This is a smoke screen put up by the food industry and it is bought into by too many in the public health sector. It is important, but the major driver of food labelling was historically and should remain the passing of accurate information from producer to consumer to facilitate the consumer to have choice in the market place and to ensure fair and free competition in the market place.
Paragraph 3.7 touches on the issue of the use of scientific jargon to obscure unwelcome information to consumers, another game that the food industry has become very adept at playing.
Submission 8 (Question 9): disclosure of ingredients needs to be comprehensive and accompanied by brief explanatory statements in information at point of sale. This information should be independently provided and verified.
4. Consumer information.
This is the heart of the issue, it is assumed but not stated that consumers have a right to know what is in a product.
Submission 9 (Questions 13 & 14): Consumers should be given a clear legal right to know what it in food products and how they have been grown, processed and stored. If FSANZ is to be retained then its brief should be amended to include this objective.
Information should be available so as to allow consumers to make well informed choices that allow the market to operate in a free and fair way.
Submission 10 (Question 15): all foods sold by other than their producer in person should have the name and address of the producer(s) on them or on display at point of sale.
It is very difficult to believe that the review team have posed the question in paragraph 3.13! Surely the public service still has some standards in regard to truth and decency even if the advertising industry has abandoned them.
Submission 11 (Question 16): the confusion over terminology such as ‘Made in Australia’ can easily be resolved by asking is the statement true or is it a lie! If it is a lie, then the law needs to be amended so that the perpetrators can be prosecuted.
A large number of terms have been deliberately abused by the food and advertising industries. There is a clear need for action in this area and it needs to be taken by independent bodies that properly represent the interests of consumers. The situation is particularly bad when it comes to the intensive livestock industries use of words and images, many of which are seriously misleading. It has been compounded by well meaning groups such as animal rights charities attaching labels such as ‘free range’ to animals that are not being actively abused, but none the less are far from free range.
Submission 12 (Question 17): Yes, there is a need to clarify terms, and it needs to be done by independent, transparent and consumer responsive groups and then given statutory backing. The EU model in relation to ‘Appellation d'Origine Contrôlée” and the UK model of the control of ‘organic’ and its certification by the Soil Association may be worth looking at.