AN ALLIANCE of feedgrain users opposed to the Queensland Government’s proposed ethanol mandate has questioned why a quantitative cost benefit analysis has not been undertaken, particularly given concerns about the net benefits of the policy and “lack of due process undertaken to date.”

Don Mackay

Alliance spokesman Don Mackay, president of the Australian Lot Feeders Association, said in accordance with the state’s Regulatory Impact System (RIS) guidelines, an RIS must be undertaken in association with the development of primary, subordinate and quasi-regulation.

“However, no RIS has been completed – a concerning issue particularly given concerns raised in other jurisdictions where mandates have been considered or introduced,” Mr Mackay said.

“The Victorian Government, for example, decided to not pursue an ethanol mandate because the costs and risks were seen to outweigh any purported benefit.”

“The Federal Government decided to not implement a mandate because no prima facie case had been established, the objectives of the mandate could be achieved by other less costly Government policies and that the unintended consequences of mandates were many, Mr Mackay said.

“The NSW Treasury has also routinely warned that the costs of its mandate outweigh the benefits, there was no net benefit to motorists in terms of fuel prices, the environmental advantages are dubious, and that the only beneficiary was Manildra who have been given a legislated monopoly and a captive market,” he said.

The Queensland Government in its own 2009 qualitative public benefit test analysis also concluded that there was no net benefit from an ethanol mandate.

“Given such concerns, why hasn’t a quantitative regulatory impact statement been undertaken in consultation with stakeholder groups?” Mr Mackay asked.

“The Minister has referenced a Deloitte report in several media statements, but the report does not focus on the costs or benefits of a mandate, merely the potential benefits should all future proposed bio-refinery projects proceed, a large assumption given only one out of fifteen projects since 2002 have eventuated.”

“Importantly the report recommends that assistance should not be provided to the sector as this leads to a mis-allocation of resources and scarce public funds being captured by owners of subsidised businesses.”

The latest concerns about due process follow the recent completion of a public consultation process held after (rather than before) the decision to implement a mandate was made by the ALP Government.

“With this flawed regulatory and public consultation process showing contempt to the general public, it is seriously doubted everyone really understands its overriding negative impacts,” Mr Mackay said.

• The ‘Against Ethanol Mandates Alliance’ comprises organisations that represent the dairy, cattle feedlot, pork, chicken and egg industries, the marine industry and stockfeed manufacturers.