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FoodLegal Editorial: What are consumer expectations of our food law system?

Published: 13 Oct 2010

FREE ARTICLE

By Joe Lederman
FoodLegal Lawyers and Consultants

© Lawmedia Pty Ltd, October 2010

FSANZ Chief Executive Officer Steve McCutcheon has announced that FSANZ will endeavour to take into account consumers’ “emotions” and perceptions of risk in order to maintain public confidence in Australia’s food safety. This article examines what consumers expect of Australia’s food regulatory system and the legal ramifications of his statement.

It is a market reality that consumer expectations are an important driver of change in the Food Industry. For example, the increasingly vocal demands by Australian consumers for food products that are more sustainable, natural and environmentally-friendly food products have resulted in an entire organic food industry as well as a wealth of new marketing campaigns with emphasis on ‘naturalness’ of food. And yet, labelling laws in Australia may not reflect the consumer demands for more information.

An important reason for this is that the government agency responsible for creating the law is required to put many considerations other than consumer expectations first.

The current role of FSANZ

It is a common misapprehension, of both consumers and the food industry, that Australia’s Federal agency Food Standards Australia New Zealand (FSANZ) serves a similar role to that of the Food and Drug Administration (FDA) in the USA: that of standard-setter and of enforcer of those standards.

While it is indeed true that FSANZ develops, updates and monitors the efficacy of the mandatory Standards for food composition and labelling contained in the Australia New Zealand Food Standards Code, it is important to note two primary distinctions from that of the role of the FDA.

First of all, FSANZ’s primary role is that of assessor. It is required by law to assess the science, the public health benefits and safeguards and safety risks and the cost/benefit analysis of all proposed changes to the Food Standards Code. While FSANZ drafts the amendments to the Code, it rarely instigates the proposed changes. Substantial changes to the Food Standards Code (as opposed to code maintenance) can only be developed as a result of policy handed down by the Food Regulation Ministerial Council or through paid applications from either companies involved in the food industry or other interested stakeholders.

Under Section 18(2) of the Food Standards Australia New Zealand Act 1991, FSANZ is legally obliged to have particular regard to the following when developing the food standards:

(a)  the need for standards to be based on risk analysis using the best available scientific evidence;

(b)  the promotion of consistency between domestic and international food standards;

(c)  the desirability of an efficient and internationally competitive food industry;

(d)  the promotion of fair trading in food;

(e)  any written policy guidelines formulated by the Council for the purposes of this paragraph and notified to the Authority.

First of all, it is interesting to note from the above list that neither consumer expectations nor the actual implementation or enforcement of the standards are amongst any of these statutory criteria listed for consideration by FSANZ.

Secondly, FSANZ does not enforce the standards which it sets. In fact, until the development of the Primary Production Standard for Eggs (under Proposal P301), the enforcement of Food Standards was not considered at the development stage. The Food Standards Code is enforced at a State and Territory level, but nationally consistent enforcement is attempted through the Implementation Sub-Committee – made up of the representatives of the food law enforcement agencies of the collective Australian States and Territories and New Zealand.

This division of powers has resulted in situations where the agency that develops the law (i.e FSANZ) is unable to provide interpretations of those very laws for industry, enforcement agencies or consumers. Similarly, several amendments to the Food Standards Code have not been implemented for long periods of time due to complications in practical enforcement that were not considered at development stage by FSANZ.

Notwithstanding the abovementioned division in powers, FSANZ is the only national food law agency in Australia. As such it is also required by law to co-ordinate national food recalls and play the role of a government-run public relations agency, communicating to consumers and industry on matters to do with food law, policy and safety, even though FSANZ may be merely a collector and disseminator of second-hand information sourced from other organisations such as food safety agencies in the Australian States or overseas.

Perceived shortfalls between reality and public expectations

In the situation where a national body is primarily a standards-setting agency (with no policy-development or enforcement powers), the assessment of consumer expectations of the law is often not considered.

Therefore, it is interesting to read the following by FSANZ CEO Steve McCutcheon in the 74th Edition of Food Standards News:

Today, FSANZ recognises that to a consumer, there are two aspects to risk: the hazard itself (identified by a scientific risk assessment) and an ‘outrage’ factor. Outrage is a measure of the emotional attachment people have to an issue. It can increase if they are not in control of the situation, if the change to food is ‘unnatural’, if it is unfamiliar or if it goes against a person’s value system.

While his statement is vague and appears to be limited to FSANZ’s reporting to consumers about risks to public health and safety, the quote specifically mentions “change to food” and “unnatural” – both of which appear on face value to relate to amending the Food Standards Code, rather than simple communication with consumers.

The fact that there were thousands of submissions made to the Blewett Labelling Review by disgruntled consumers would seem to indicate a high level of dissatisfaction with the final impact on consumers of the usual FSANZ process of food standards development.

Possible outcomes of consumer expectations being taken into account

It would be very interesting were FSANZ to take into account consumer expectations of a food standard for a food when developing any food standards.

By way of example, a number of existing exemptions in the genetically-modified food standard (Standard 1.5.2) mean that consumers may well be consuming genetically-modified food products without knowing it (see our FoodLegal Bulletin, July 2008 article “Why Australian consumers are eating GM food without knowing it”). Many consumers appear to consider genetically-modified food to be “unnatural”. If their expectations were to be considered, the exemptions could well be tightened, resulting in far more food products being labelled as “GM”. However, the question is whether or not FSANZ would take that view or would argue for maintenance of the status quo on the basis that consumers were simply being too emotional?

Similarly, Standard 1.2.11 has minimal country of origin requirements such that most foods need only declare the place where they were packaged rather than specifying where most of the ingredients originate from: (see also our article “Resolving the conflicts over ‘safe harbour’ labelling”). However, many Australian consumers want to know the countries of origin of the ingredients in the product, not where the product was “made/manufactured/packaged”. Would this Standard change if consumer expectations were taken into account? Or would FSANZ consider that the consumers were experiencing an emotional reaction by expressing dissatisfaction with the Food Standards Code?

Obviously, taking into account consumer expectations would have serious regulatory ramifications on both these issues and more. But it is early days at this point. The FSANZ Act might need to be changed to give additional helpful powers to those who are to be responsible for development and enforcement of Australia’s food laws.

Consumers expectations about food standards are not the only issue. Consumer expectations about the role of FSANZ itself also comes into play. Consumer confidence in a system of food regulatory enforcement, and transparent government-monitoring of food safety and health impacts, requires difficult issues to be tackled. What might be needed is a stronger sense of leadership and vision, both for the future of the food industry in Australia and the needs of Australian consumers.

Footnote:

On the 30 September 2010, FSANZ called for tenders for a review of its consumer surveys in relation to many of its Food Standards. A copy of the tender is set out below.

FSANZ Addendum RFT 20101103