Prime Minister Tony Abbott has called on two senior ministers to prepare a cabinet submission on country-of-origin labelling laws. The move follows a national outbreak of hepatitis A linked to frozen berries from China and Chile.
The outbreak was a strong reminder that all is not well in Australia’s food supply. Once the alleged offending ingredient was identified and relevant products recalled, consumers claimed they were not aware the berries they were choosing to eat were from China.
But labelling on the berry products complied with current labelling and consumer information laws. And despite the recall highlighting the inadequacy of the labelling, the prime minister dismissed initial calls for changes. He said it would make life very hard for business, would raise the cost of food and that it was the responsibility of business “not to poison their customers”.
That changed this morning when Abbott asked Agriculture Minister Barnaby Joyce and Industry Minister Ian MacFarlane to submit a proposal to cabinet in March. MacFarlane has already warned consumers may have to bear the cost of the change.
Here’s one problem with this current food-labelling system: “Made in Australia from local and imported ingredients” does not actually reveal where the food comes from. A company can claim a product is made in Australia if at least half the cost of manufacturing that product is incurred here.
Consider a jar of jam: the total cost of production includes the cost of producing the lid, the jar, the label, as well as the jam. Half the cost of production could easily be attributed to the jar itself, leaving room for jam ingredients to be imported and still allowing the label to say it was made in Australia.
The 2011 report on the effectiveness of Australia’s food-labelling system described the challenges for improving transparency. It identified country-of-origin labelling as a particularly contentious issue, and recommended:
That for foods bearing some form of Australian claim, a consumer-friendly, food-specific country-of-origin labelling framework, based primarily on the ingoing weight of the ingredients and components (excluding water), be developed.
This recommendation was taken up by Greens leader Christine Milne. She introduced a bill to improve transparency of country-of-origin labelling just before the berry scare. It calls for three items on labels that cover where a product is grown, where it’s manufactured and where it is packaged.
Even before this, consumer organisation Choice launched a campaign about country-of-origin labelling in January 2012 after a survey showed 86% of respondents found such labels unclear.
Choice proposes a three-tiered system that specifies “product of” for primary produce such as fruit and vegetables, “manufactured in” and “packaged in”. This last one would cover foods with input from multiple companies, which makes it difficult to isolate single ingredients, and products such as mixed frozen vegetables where each vegetable is from a different country. Choice plans to develop exact wording through consumer testing.
Another simple and practical way to resolve the problem is to include the origin of imported ingredients in the “ingredient list”. Labelling laws mandate that ingredient lists appear on every product. Individual ingredients are listed in order of volume, from most to least.
Take peanut butter as an example. Its ingredients list says roasted peanuts, vegetable oil, sugar and salt. If labelling laws mandated the listing of country of origin for imported ingredients, the list might say roasted peanuts (China), vegetable oil (Chile), sugar (Phillipines) and salt.
Ingredients sourced locally wouldn’t need to be declared as made in Australia would the default position; only imported ingredients would need to state the country of origin.
It’s about time
Milne’s bill has attracted the ire of the Australian Food and Grocery Council, the peak food, drink and grocery manufacturing body. And food manufacturers have already responded to the prime minister’s announcement. They say changing the labelling system would place an unreasonable burden on them.
But changing the wording of a label is different from adding a regime of increased testing and reporting. And although risk assessment and testing of imported foods is vital, what we now need for consumer confidence is the more cost-effective option of label change.
Food companies track the exact point of origin of each ingredient because of quality-control procedures, supported by Australia’s food laws. All consumers want is for the companies to tell them what they already know.
Changing Australia’s country-of-origin labelling system will effectively give consumers power to make informed decisions in the free market. And it will overcome the current information asymmetry, which keeps them in the dark.