Cattle Council set to adopt direct membership

James Nason, 03/09/2013


The long-running CCA restructure process suddenly looks much closer to achieving a final result following two days of deliberations in Melbourne.  

The organisation says it has arrived at a preferred model that will deliver both greater representation for all cattle producers across Australia and a more solid funding base.

The model will see a pathway for direct membership of Cattle Council of Australia created for the first time.

For a $100 +GST membership fee any cattle producer around Australia will be able to join the national peak representative body without also needing to be a member of a State Farm Organisation (SFO), and will be able to have direct input into national policy setting or to stand for election to the national board or one of several issues-based committees that guide council decisions. Existing SFO members can elect to also be a direct member of Cattle Council for free.

The board will be downsized from its current size of 23 SFO-appointed members and restructured to comprise eight SFO appointed board members and up to four directly-elected board members.

Each SFO will appoint one representative each (the 8 SFO’s are NTCA, AgForce, NSW Farmers, VFF, TGFA, SA Livestock, WAFF and PGA). AgForce and NSW Farmers will receive more votes than the other states in recognition of their higher financial contribution to CCA.

The initial structure will allow for two directly-elected board members to be voted in by producers who are direct members. One will be voted in to represent direct producer members in northern Australia, the second to represent direct producer members in the south.

When the number of direct members reaches 500, the number of directly elected board members will increase to four (two representing the north, and two representing the south).

Future increases in the number of directly elected board members will depend on the take-up of direct memberships by producers.

“This model recognises that we need to continue the advocacy investment from SFOs, but over time as direct members come on board, and their share of investment in the company grows, their level of influence will also grow,” CCA chief executive officer Jed Matz explained.

“Producers told us they wanted a say at Cattle Council, so what we’re asking producers to do is to put their money where their mouth is and join up.”

CCA says it has also secured a stronger financial base for the future.

While revenue generated from direct membership fees will partially help to increase funding, proceeds from the compulsory $5/head transaction levy will provide the biggest boost to resourcing.

However, not in a direct sense.

Earlier in the restructure process CCA was hoping to secure direct access to levy funds, however that option appears to have ended up in the too-hard basket because of the legislative barriers and perceived time delays that stand in the way of direct access to those socialised funds being granted.

Instead, CCA says it has negotiated new arrangements with the Federal Government and Meat & Livestock Australia that will enable resources in levy-funded service organisations such as MLA to better resource some of the strategic industry work CCA currently does for the benefit of all cattle producers.

One of CCA’s core functions is advocacy, but this can only be funded through money received from voluntary membership fees, not compulsorily acquired funds.

This means CCA can only fund its advocacy work from the $430,000 it receives from State Farm Organisations each year, and the funding it will receive from direct membership revenue in future.

Its other functions include strategic industry work for the benefit of all grassfed cattle producers such as national policy development, devising and implementing the industry’s strategic plan, and providing representation for producers on more than 60 committees.

Some of this work is meant to be funded from the $500,000 a year CCA receives from the Red Meat Industry Fund, but it inevitably swallows up much more.

This has effectively forced CCA to eat into revenue received from SFOs to fund strategic industry functions, which in turn has restricted the resources it has been able to direct towards advocacy.

CCA believes it has now solved its resourcing issues by recently confirming that it can request levy-funded service organisations to cover some of the costs incurred by doing strategic industry work on behalf of all producers.

For example, where CCA members are required to attend Animal Health Australia meetings in future, the levy-funded AHA would fund the travel and accommodation costs of CCA representatives attending the meeting, not CCA itself.

Or, taking the example of policy development, an area that the strategic planning process has identified that is in dire need of better resourcing, CCA would now request MLA to fund independent policy research in particular areas, freeing up CCA resources to advocate particular recommendations and policy outcomes.

“It is a much better realignment of all of our resources, better redefining all the different roles in the industry so we don’t spend money where we shouldn’t,” Mr Matz said.

“It means we no longer have to divert money we receive from SFOs for advocacy to other things, we can now better focus those resources on advocacy.

He predicted that Cattle Council would be somewhere between $500,000 and $700,000 better off in terms of resources at its disposal in future, which had lifted the funding pressure off the council to a large extent.

“CCA was always well enough funded to be an organisation in its own right, it just wasn’t well enough funded to deliver the outcomes that industry wanted,” Mr Matz said.

“What we have been able to do is organise the industry’s resources so that Cattle Council now can focus on delivering the outcomes that industry wants.

“We may not be as well as funded as some people would have hoped, but I think you will see in the next year Cattle Council will be kicking a lot of goals and really taking a positive approach to how we manage the industry.”

The model is currently being considered by each SFO, and if constitutional changes required to support its implementation are passed at the council’s annual general meeting in late October, the new structure would then commence from that date.

The first two directly-elected board members will be installed as soon as enough producers have signed on as direct members to enable a vote on candidates to take place. CCA believes that number would be about 200.

There has been some debate in the past about how appropriate it is for CCA to accept funding support from MLA, and whether that could compromise its role as an independent administrator of MLA.

CCA has already progressed down the path of accessing levy funding by signing a service agreement with MLA last year to co-host open producer forums around the country.

The meetings are designed to give producers an opportunity to discuss MLA programs directly with MLA staff and industry policy issues directly with CCA representatives in the same forum.

It is understood CCA will receive around $450,000 from MLA to co-host the forums.

Critics have raised concerns the move could see CCA become reliant on MLA funding which will weaken its ability to maintain an independent oversight role of MLA on behalf of producers, akin to being reluctant to taking MLA to task in future for fear of biting the hand that feeds it.

“We have heard that criticism but I reject that,” Mr Matz said.

“This is Cattle Council telling MLA where it wants its resources directed, and we have told them we want it directed towards producer consultation, the recovery of the costs of Cattle Council consulting with MLA, and we want MLA to invest more in the policy development process so we have robust policy recommendations that our council can advocate.

“This is actually, in my view, Cattle Council having greater control over its levy, and giving producers greater control over their levy by being able to get more involved with Cattle Council and have more say over how it is being spent.

He said MLA had to comply with Cattle Council’s directions on how funds generated from grassfed levies are spent.

“We are the peak council and we direct how MLA spends it money. The industry has demonstrated that this is how it wants to prioritise its funds, and now Cattle Council is directing MLA to do so.”

CCA president Andrew Ogilvie said the introduction of a direct membership pathway meant that for the first time Australian beef producers will have the opportunity to become a direct member of Cattle Council.

Producers who are already members of SFOs will continue to be members of the organisation, but will also be able to elect to become members of CCA as well, while non-SFO members can join Cattle Council for $100 + GST.

Membership rights will allow producers to:

  • Stand for the Cattle Council Board;
  • Vote on board elections;
  • Communicate directly to Cattle Council on national policy issues;
  • Receive regular updates from Cattle Council;
  • Nominate to participate on Cattle Council policy sub-committees; and
  • Receive members-only access to the soon-to-be launched Cattle Council interactive website.

“We think that $100 represents really good value and is not very much to support the organisation that is ensuring you can remain in business into the future, and you have market access,” Mr Matz said.



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