Olive Oil Industry

The Hon. K.J. MAHER (15:11): My question is to the Minister for Business Services and Consumers. Can the minister update—

Members interjecting:

The PRESIDENT: Are we all finished? The clock is ticking down and there are some crossbenchers who actually want to ask some questions, so I would ask the opposition not to. The Hon. Mr Maher.

The Hon. K.J. MAHER: My question is to the Minister for Business Services and Consumers. Can the minister update the chamber on the work being undertaken by the Consumer Affairs Forum regarding concerns raised by the olive industry about olive oil labelling?

The Hon. G.E. GAGO (Minister for Employment, Higher Education and Skills, Minister for Science and Information Economy, Minister for the Status of Women, Minister for Business Services and Consumers) (15:11): I thank the honourable member for his most important question. We all love olive oil and I am very pleased to advise members about South Australia's involvement on the Consumer Affairs Forum in relation to addressing concerns with the labelling of olive oil supplied in Australia.

Australian consumers now have access to many different types of olive oils, with labels that can vary significantly between and within brands. The two common types of olive oil are virgin olive oil and refined olive oil. Virgin olive oil is extracted from the olive fruit by mechanical or physical means. There are no chemicals or heat involved in the process. This ensures that the oil is not altered and it retains its nutritional value. Extra virgin olive oil is considered to be the highest grade olive oil, followed by virgin olive oil which may have some flavour defects. Pressed olive oil that does not fall within the quality grade of extra virgin or virgin may be refined by using chemicals to remove impurities.

Common terms often associated with refined olive oils include simply 'olive oil' which typically consists of refined olive oils blended with virgin olive oils. There are also 'light' and 'extra light' olive oils which are milder in flavour and colour than extra virgin. These oils do not have reduced kilojoules like some people might be led to believe. They do not have reduced kilojoules, calories or fat content. Another common term used is 'pure' olive oil, which is typically a blend of refined and virgin olive oil. It consists of only olive oil rather than oil extracted from any other fruits or vegetables.

The Australian olive industry has expressed concerns about consumer detriment associated with international labelling practices of olive oil, and I understand that the industry proposed that the Australian Standard for Olive Oils and Olive Pomace Oils be declared a mandatory information standard under the Australian Consumer Law as a way of addressing these concerns. However, I am advised that the industry's concerns relate to the marketing of olive oil products and the competitiveness of the Australian olive oil industry more generally.

In determining whether to make such a standard, a rigorous impact analysis is required to determine whether further regulation is necessary and what its likely impact is. This includes consideration of the additional costs that would be imposed on the industry (particularly small-scale producers and we have many of them here in this state) in complying with the new regulation, to consumers in the form of higher prices, and to governments in enforcing the information standard. Of course, as we know, those costs are usually passed on to businesses as well on a cost-recovery basis, and that cost is then reflected in the price of the product.

Since 2012, consumer affairs agencies have been actively responding to issues raised by the industry regarding the labelling of olive oil, including the release of consumer guidance material on the commonly used labels on olive oil products, as well as a national compliance and enforcement operation to test the labelling and quality of olive oil supplied here in Australia.

Extensive work undertaken by consumer agencies includes: the release of guidance material for consumers, ‘The Good Oil’, to provide information about the characteristics and qualities of olive oil products to assist them with their purchasing decisions; a national compliance and enforcement program to assess representations made on over 350 olive oil products comprising all major and lesser-known brands, both Australian and internationally produced; enforcement action taken against a number of businesses for mislabelling olive oil as extra virgin when it was not of that quality; and, discussion with Food Standards Australia New Zealand on the question of food safety issues related to olive oil products as supplied here in Australia.

In July 2013, the Consumer Affairs Forum collectively formed a view that there is minimal evidence of consumer detriment in the market in terms of systemic misrepresentation of labelling of olive oil products. The Consumer Affairs Forum also agreed that the existing regulatory framework is sufficiently robust to deal with concerns that businesses are engaging in misleading or deceptive conduct or making false or misleading representations in relation to olive oil. Penalties of up to $1.1 million apply.

For those who have not had the opportunity to view the publication ‘The Good Oil’, developed by consumer affairs agencies, I recommend they visit the Consumer and Business Services or ACCC websites. Consumers seeking general advice on their rights, business obligations or more information on how to report potential misleading or deceptive conduct by a retailer, I encourage them to contact the Consumer and Business Services advisory telephone line or visit the website.