Uncertainty and speculation associated with DAAS to end

30/6/99
Primary Industry Minister Monty House said that he intended to end the uncertainty and speculation associated with the Distribution Adjustment Assistance Scheme (DAAS) and finalise adjustment payment opportunities to milk distributors.
Speaking in Parliament today, Mr House said that he was dealing with a legacy from the previous Labor Government to fully deregulate the milk distribution sector.
Up to January 1993, Labor had engaged in progressive deregulation of the milk distribution including the restriction of licensed districts from 226 to 90 and introducing Scheme A of the Distribution Adjustment Assistance Scheme.
Labor had intended full deregulation by July 1993.
"Coming in to Government in February 1993, industry was unhappy about Labor's existing deregulation proposal and requested me to review the situation," Mr House said.
"In consultation with the Milk Vendors Association, I appointed Mr Eric Kelly, a former industrial relations commissioner, to examine the issue of deregulation.
"After further consultation and Parliamentary debate, I took steps to accommodate a more reasonable position on the adjustment of milk distribution businesses."
These included:

• increasing the total available funds from $1 million originally proposed by the Labor Government to $7 million;
• increasing the level of payment from $35 per litre to $50;
• increasing the maximum payment to a business from $50,000 to $150,000;
• appointing an independent arbiter, Mr John Negus; and -
• negotiating with milk companies to extend vendor contracts from one to three years.

With the introduction of DAAS Schemes B and C on February 3, 1995 more than $3.1 million was originally paid to 48 businesses.
"More recently, I requested the independent arbiter to act on the recommendations of Report numbers 3, 6 and 10 of the Legislative Council.
"As a result, at May 31, 1999, a further $1.2 million has been paid to 32 milk distributors, bringing the total DAAS payments to over $5.4 million.
"From the original 255 milk distributors, there are seven who claim they have not received adequate recompense.
"These seven vendors have received more than $875,000 in total payments to date and a further offer of $609,000.
"The Dairy Industry Authority today will provide a final financial assistance offer from Government to these milk distributors. The offer will close on Wednesday, July 28."
Mr House said that by all accounts, both the process and the financial provisions had been fair and reasonable.
The principles of the adjustment process have been maintained and the reports of the standing committee on public administration had been complied with.
Media contact: Julie Cole 9481 2944